10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended September 30, 2012
	OR
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from _________ to __________

Commission file number: 001-35263

AMERICAN REALTY CAPITAL PROPERTIES, INC.

(Exact name of registrant as specified in its charter) 

Maryland	45-2482685
(State or other  jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
405 Park Ave., 15th Floor, New York, NY	10022
(Address of principal executive offices)	(Zip Code)

(212) 415-6500

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant submitted electronically and posted on its corporate Web Site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See definition of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer o		Accelerated filer x
Non-accelerated filer o	(Do not check if a smaller reporting company)	Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yeso Nox

The number of outstanding shares of the registrant’s common stock on October 29, 2012 was 11,163,617 shares.

AMERICAN REALTY CAPITAL PROPERTIES, INC.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

	Page
PART I — FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets as of September 30, 2012 (Unaudited) and December 31, 2011	1
Consolidated Statements of Operations and Comprehensive Loss for the Three and Nine Months Ended September 30, 2012 and 2011 (Unaudited)	2
Consolidated Statement of Changes in Equity for the Nine Months Ended September 30, 2012 (Unaudited)	3
Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2012 and 2011 (Unaudited)	4
Notes to Consolidated Financial Statements (Unaudited)	5
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3. Quantitative and Qualitative Disclosures About Market Risk	32
Item 4. Controls and Procedures	33
PART II — OTHER INFORMATION
Item 1. Legal Proceedings	33
Item 1A. Risk Factors	33
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	34
Item 3. Defaults Upon Senior Securities	34
Item 4. Mine Safety Disclosures	34
Item 5. Other Information	34
Item 6. Exhibits	34
Signatures	35

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements.

AMERICAN REALTY CAPITAL PROPERTIES, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except for share and per share data)

	September 30, 2012			December 31, 2011
	(Unaudited)
ASSETS
Real estate investments, at cost:
Land	$	28,717		$	18,489
Buildings, fixtures and improvements	182,700			107,340
Acquired intangible lease assets	24,306			11,044
Total real estate investments, at cost	235,723			136,873
Less: accumulated depreciation and amortization	(20,954		)	(14,841		)
Total real estate investments, net	214,769			122,032
Cash and cash equivalents	3,779			3,148
Prepaid expenses and other assets	3,015			1,798
Deferred costs, net	4,204			2,785
Assets held for sale	812			1,818
Total assets	$	226,579		$	131,581
LIABILITIES AND EQUITY
Mortgage notes payable	$	35,760		$	30,260
Senior secured revolving credit facility	91,090			42,407
Accounts payable and accrued expenses	1,276			858
Deferred rent	803			724
Total liabilities	128,929			74,249
Series A convertible preferred stock, $0.01 par value, 545,454 and 0 shares (liquidation preference $11.00 per share) authorized, issued and outstanding at September 30, 2012 and December 31, 2011, respectively	5			—
Series B convertible preferred stock, $0.01 par value, 283,018 and 0 shares (liquidation preference $10.60 per share) authorized, issued and outstanding at September 30, 2012 and December 31, 2011, respectively	3			—
Common stock, $0.01 par value, 240,000,000 shares authorized, 11,163,617 and 7,323,434 issued and outstanding at September 30, 2012 and December 31, 2011, respectively	112			73
Additional paid-in capital	101,325			57,582
Accumulated other comprehensive loss	(13		)	—
Accumulated deficit	(13,295		)	(4,025		)
Total stockholders’ equity	88,137			53,630
Non-controlling interests	9,513			3,702
Total equity	97,650			57,332
Total liabilities and equity	$	226,579		$	131,581

The accompanying notes are an integral part of these statements.

1

AMERICAN REALTY CAPITAL PROPERTIES, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(In thousands, except for per share data)

(Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2012			2011			2012			2011
Revenues:
Rental income	$	4,791		$	576		$	10,997		$	576
Operating expense reimbursements	89			—			175			—
Total revenues	4,880			576			11,172			576
Operating expenses:
Acquisition and transaction related	819			604			3,297			604
Property operating	315			—			555			—
General and administrative	617			84			1,530			100
Depreciation and amortization	2,818			363			6,092			363
Total operating expenses	4,569			1,051			11,474			1,067
Operating income (loss)	311			(475		)	(302		)	(491		)
Interest expense	(1,136		)	(185		)	(2,873		)	(185		)
Loss from continuing operations	(825		)	(660		)	(3,175		)	(676		)
Net loss from continuing operations attributable to non-controlling interests	62			35			141			35
Net loss from continuing operations attributable to stockholders	(763		)	(625		)	(3,034		)	(641		)
Discontinued operations:
Income (loss) from operations of held for sale properties	3			(9		)	(12		)	(9		)
Loss on held for sale properties	(47		)	—			(452		)	—
Net loss from discontinued operations	(44		)	(9		)	(464		)	(9		)
Net loss from discontinued operations attributable to non-controlling interests	3			—			24			—
Net loss from discontinued operations attributable to stockholders	(41		)	(9		)	(440		)	(9		)
Net loss	(869		)	(669		)	(3,639		)	(685		)
Net loss attributable to non-controlling interests	65			35			165			35
Net loss attributable to stockholders	$	(804	)	$	(634	)	$	(3,474	)	$	(650	)
Other comprehensive loss:
Designated derivatives, fair value adjustment	—			—			(13		)	—
Comprehensive loss	$	(804	)	$	(634	)	$	(3,487	)	$	(650	)
Basic and diluted net loss per share from continuing operations attributable to common stockholders	$	(0.08	)	$	(0.41	)	$	(0.38	)	$	(1.25	)
Basic and diluted net loss per share attributable to common stockholders	$	(0.09	)	$	(0.42	)	$	(0.43	)	$	(1.27	)

The accompanying notes are an integral part of these statements.

2

AMERICAN REALTY CAPITAL PROPERTIES, INC.

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

(In thousands, except for share data)

(Unaudited)

	Convertible Preferred Stock			Common Stock
	Number of Shares	Par Value		Number of Shares	Par Value		Additional Paid-In Capital			Accumulated Other Comprehensive Loss			Accumulated Deficit			Total Stock-holders' Equity			Non-Controlling Interests			Total Equity
Balance, December 31, 2011	—	$	—	7,323,434	$	73	$	57,582		$	—		$	(4,025	)	$	53,630		$	3,702		$	57,332
Issuance of preferred stock	828,472	8		—	—		8,992			—			—			9,000			—			9,000
Issuance of common stock	—	—		3,737,500	38		34,897			—			—			34,935			—			34,935
Offering costs	—	—		—	—		(937		)	—			—			(937		)	—			(937		)
Share-based compensation	—	—		102,683	1		791			—			—			792			—			792
Distributions declared	—	—		—	—		—			—			(5,796		)	(5,796		)	—			(5,796		)
Contribution from non-controlling interest holder	—	—		—	—		—			—			—			—			6,352			6,352
Distributions to non-controlling interest holders	—	—		—	—		—			—			—			—			(376		)	(376		)
Other comprehensive loss	—	—		—	—		—			(13		)	—			(13		)	—			(13		)
Net loss	—	—		—	—		—			—			(3,474		)	(3,474		)	(165		)	(3,639		)
Balance, September 30, 2012	828,472	$	8	11,163,617	$	112	$	101,325		$	(13	)	$	(13,295	)	$	88,137		$	9,513		$	97,650

The accompanying notes are an integral part of this statement.

3

AMERICAN REALTY CAPITAL PROPERTIES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Nine Months Ended September 30,
	2012			2011
Cash flows from operating activities:
Net loss	$	(3,639	)	$	(685	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation	4,875			351
Amortization of intangible lease assets	1,217			21
Amortization of deferred costs	530			30
Amortization of above-market lease asset	56			—
Loss on held for sale properties	452			—
Share-based compensation	792			2
Changes in assets and liabilities:
Prepaid expenses and other assets	(1,087		)	(48		)
Accounts payable and accrued expenses	142			(115		)
Deferred rent	79			687
Net cash provided by operating activities	3,417			243
Cash flows from investing activities:
Investments in real estate	(92,498		)	—
Proceeds from sale of property held for sale	553			—
Net cash used in investing activities	(91,945		)	—
Cash flows from financing activities:
Proceeds from mortgage notes payable	5,500			—
Proceeds from senior secured revolving credit facility	48,793			—
Payments on senior secured revolving credit facility	(110		)	—
Proceeds from issuances of preferred shares	9,000			—
Proceeds from issuances of common stock	34,935			5,237
Payments of offering costs and fees related to stock issuances	(672		)	(3,912		)
Payments of deferred financing costs	(1,949		)	(1,016		)
Advance from affiliate bridge loan	796			—
Payment of affiliate bridge loan	(796		)	—
Due from (to) affiliates	(164		)	278
Premium payment on interest rate cap	(13		)	—
Distributions to non-controlling interest holders	(376		)	—
Distributions paid	(5,785		)	—
Net cash provided by financing activities	89,159			587
Net change in cash and cash equivalents	631			830
Cash and cash equivalents, beginning of period	3,148			—
Cash and cash equivalents, end of period	$	3,779		$	830
Supplemental Disclosures:
Cash paid for interest	$	2,301		$	—
Cash paid for income taxes	64			—
Non-cash investing and financing activities:
OP units issued to acquire real estate investments	6,352			—

The accompanying notes are an integral part of these statements.

4

AMERICAN REALTY CAPITAL PROPERTIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2012

(Unaudited)

Note 1 — Organization

American Realty Capital Properties, Inc. (the “Company”), is a Maryland corporation incorporated on December 2, 2010 that qualified as a real estate investment trust for U.S. federal income tax purposes for the year ended December 31, 2011. On September 6, 2011, the Company completed its initial public offering (the “IPO”) and sold a total of 5.6 million shares of common stock. The shares began trading on the NASDAQ Capital Market under the symbol “ARCP” on September 7, 2011. As of September 30, 2012, the Company had 11.2 million shares of common stock outstanding, including unvested restricted shares, and had received aggregate gross proceeds from common stock issuances of $118.9 million. In addition, as of September 30, 2012, the Company had received aggregate gross proceeds of $9.0 million from the issuance of convertible preferred stock.

On August 1, 2012, the Company filed a universal shelf registration statement and a resale registration statement with the U.S. Securities and Exchange Commission.  Each registration statement became effective on August 17, 2012.  The $500.0 million universal shelf registration statement, as amended, will enable the Company to grow its capital base over time while providing it flexibility to issue common stock, preferred stock, debt or equity-linked securities. As of September 30, 2012, no common stock, preferred stock, debt or equity-linked security has been issued under the universal shelf registration statement.  The resale registration statement, as amended, registers the resale of up to 1,882,248 shares of common stock issued in connection with any future conversion of certain currently outstanding restricted shares, convertible preferred stock or limited partnership interests. As of September 30, 2012, no common stock has been issued under the resale registration statement.

The Company was formed to acquire and own single-tenant, freestanding commercial real estate primarily subject to medium-term net leases with high credit quality tenants. The Company considers properties that are net leased on a “medium-term basis” to mean properties originally leased long-term (ten years or longer) that currently have a primary remaining lease duration of generally three to eight years, on average.

Substantially all of the Company's business is conducted through ARC Properties Operating Partnership, L.P. (the “OP”), a Delaware limited partnership. The Company is the sole general partner and holder of 92.5% of the equity interest in the OP as of September 30, 2012. ARC Real Estate Partners, LLC (the “Contributor”) and an unaffiliated investor are limited partners and owners of 2.6% and 4.9%, respectively, of the equity interest in the OP. After holding units of limited partner interests in the OP (“OP Units”) for a period of one year, holders of OP Units have the right to convert OP Units for the cash value of a corresponding number of shares of the Company's common stock or, at the option of the OP, a corresponding number of shares of the Company's common stock, as allowed by the limited partnership agreement of the OP. The remaining rights of the holders of OP Units are limited, however, and do not include the ability to replace the general partner or to approve the sale, purchase or refinancing of the OP’s assets.

The Company, which is externally managed with no employees, has retained ARC Properties Advisors, LLC (the "Manager"), a wholly owned subsidiary of AR Capital, LLC (the “Sponsor”), to manage its affairs on a day to day basis. These affiliated parties, including the Manager, the Sponsor and the Sponsor's wholly owned broker-dealer, Realty Capital Securities, LLC ("RCS" or the "Dealer Manager"), have received compensation and fees for services provided to the Company, and will continue to receive compensation and fees for providing on-going investment oversight, financing and management services to the Company, as applicable, in accordance with the terms of the respective agreements to which such affiliates are party.

Note 2 — Summary of Significant Accounting Policies

The consolidated financial statements of the Company included herein were prepared in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The information furnished includes all adjustments and accruals of a normal recurring nature, which, in the opinion of management, are necessary for a fair presentation of results for the interim periods. The results of operations for the three and nine months ended September 30, 2012 are not necessarily indicative of the results for the entire year or any subsequent interim period.

5

AMERICAN REALTY CAPITAL PROPERTIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2012

(Unaudited)

These financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto as of and for the year ended December 31, 2011, which are included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC") on March 19, 2012. There have been no significant changes to these policies during the nine months ended September 30, 2012, other than the updates described below.

Recent Accounting Pronouncements

In May 2011, the Financial Accounting Standards Board (the "FASB") issued guidance that expands the existing disclosure requirements for fair value measurements, primarily for Level 3 measurements, which are measurements based on unobservable inputs such as the Company’s own data. This guidance is largely consistent with current fair value measurement principles with few exceptions that do not result in a change in general practice. The guidance was applied prospectively and was effective for interim and annual reporting periods ending after December 15, 2011. The adoption of this guidance did not have a material impact on the Company’s financial position or results of operations as the guidance relates only to disclosure requirements.

In June 2011, the FASB issued guidance requiring entities to present items of net income and other comprehensive income either in one continuous statement – referred to as the statement of comprehensive income – or in two separate, but consecutive, statements of net income and other comprehensive income. The new guidance does not change which components of comprehensive income are recognized in net income or other comprehensive income, or when an item of other comprehensive income must be reclassified to net income. In December 2011, the FASB deferred certain provisions of this guidance related to the presentation of certain reclassification adjustments out of accumulated other comprehensive income, by component in both the statement and the statement where the reclassification is presented. This guidance was applied prospectively and was effective for interim and annual reporting periods ended after December 15, 2011. The adoption of this guidance did not have a material impact on the Company’s financial position or results of operations but changed the location of the presentation of other comprehensive income to more closely associate the disclosure with net income.

In September 2011, the FASB issued guidance that allows entities to perform a qualitative analysis as the first step in determining whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If it is determined that it is not more likely than not that the fair value of the reporting unit is less than its carrying amount, then a quantitative analysis for impairment is not required. The guidance was effective for interim and annual impairment tests for fiscal periods beginning after December 15, 2011.  The adoption of this guidance did not have a material impact on the Company's financial position or results of operations.

In December 2011, the FASB issued guidance which contains new disclosure requirements regarding the nature of and entity's rights of offset and related arrangements associated with its financial instruments and derivative instruments. The new disclosures are designed to make financial statements prepared under U.S. GAAP more comparable to those prepared under International Financial Reporting Standards and will give the financial statement users information about both gross and net exposures. The guidance is effective for interim and annual reporting periods beginning on or after January 1, 2013.  The adoption of this guidance is not expected to have a material impact on the Company's financial position or results of operations.

In July 2012, the FASB issued revised guidance intended to simplify how an entity tests indefinite-lived intangible assets for impairment. The amendments will allow an entity first to assess qualitative factors to determine whether it is necessary to perform a quantitative impairment test. An entity will no longer be required to calculate the fair value of an indefinite-lived intangible asset and perform the quantitative test unless the entity determines, based on a qualitative assessment, that it is more likely than not that its fair value is less than its carrying amount. The amendments are effective for annual and interim indefinite-lived intangible asset impairment tests performed for fiscal years beginning after September 15, 2012. Early adoption is permitted. The adoption of this guidance is not expected to have a material impact on the Company's financial position or results of operations.

6

AMERICAN REALTY CAPITAL PROPERTIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2012

(Unaudited)

Note 3 — Real Estate Investments

The following table presents the allocation of real estate investment assets acquired by the Company during the ninemonths ended September 30, 2012 (dollar amounts in thousands):

Real estate investments, at cost:
Land	$	10,228
Buildings, fixtures and improvements	75,360
Total tangible assets	85,588
Acquired intangibles:
In-place leases	13,262
Total assets acquired, net	98,850
OP Units issued to acquire real estate investments	(6,352		)
Cash paid to acquire real estate investments	$	92,498
Number of properties acquired	36

The Company owns and operates commercial properties. As of September 30, 2012, the Company owned 125 properties, one of which is vacant and classified as held for sale.  Buildings, fixtures and improvements include $8.0 million, comprised of $5.1 million, $1.1 million and $1.8 million, provisionally assigned to buildings, fixtures and improvements, respectively, pending receipt of the final cost segregation analysis on such assets being prepared by a third party specialist. The Contributor, an affiliate of the Sponsor, contributed 63 properties (the "Contributed Properties") in September 2011 in conjunction with the completion of the IPO at amortized cost.

On July 3, 2012, the Company sold a vacant property in Havertown, PA, which was classified as held for sale for net proceeds of $0.6 million.

7

AMERICAN REALTY CAPITAL PROPERTIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2012

(Unaudited)

The Company’s portfolio of real estate investment properties (excluding one vacant property), which were all 100% leased, is comprised of the following 124 properties as of September 30, 2012:

Portfolio	Contribution or Acquisition Date	Number of Properties	Square Feet	Remaining Lease Term (1)	Base Purchase Price (2)		Capitalization Rate (3)	Annualized Rental Income/ NOI (4)		Annualized Rental Income/NOI per Square Foot
					(in thousands)			(in thousands)
Home Depot	Sep, 2011	1	465,600	17.2	$	23,398	9.7%	$	2,258	$	4.85
Citizens Bank	Sep, 2011	59	291,920	5.4	95,241		7.1%	6,726		23.04
Community Bank	Sep, 2011	1	4,410	3.8	705		5.1%	36		8.16
Dollar General I	Nov, 2011	20	177,668	6.9	9,981		9.7%	965		5.43
Advance Auto	Nov. & Dec. 2011	6	42,000	7.1	5,122		8.9%	457		10.88
Walgreens I	Dec, 2011	1	14,414	9.0	2,426		10.1%	245		17.00
Portfolio - December 31, 2011		88	996,012	8.2	136,873		7.8%	10,687		10.73
GSA I (5)	Jan, 2012	1	12,009	6.4	4,850		8.2%	396		32.98
Walgreens II	Jan, 2012	1	15,120	6.3	3,778		9.2%	346		22.88
FedEx	May, 2012	6	92,935	4.2	12,207		9.0%	1,099		11.83
John Deere	May, 2012	1	552,960	5.3	26,126		9.0%	2,353		4.26
GSA II (5)	Jun, 2012	1	18,640	6.0	5,835		11.1%	647		34.71
GSA III (5)	Jun, 2012	1	39,468	4.6	6,350		9.5%	604		15.30
Tractor Supply	Jun, 2012	1	38,507	6.1	1,921		9.5%	183		4.75
GSA IV (5)	Jun, 2012	1	22,509	6.0	3,890		11.0%	428		19.01
Dollar General II	Jun, 2012	16	134,102	5.1	5,993		10.7%	642		4.79
GSA V (5)	Jun, 2012	1	11,281	4.4	2,200		9.9%	217		19.24
Mrs Baird's	Jul, 2012	1	75,050	4.7	6,213		10.2%	631		8.40
Reckitt Benckiser	Aug, 2012	1	32,000	5.6	10,000		9.6%	964		30.13
CVS	Sep, 2012	3	31,620	4.7	4,855		9.9%	481		15.21
Iron Mountain	Sep, 2012	1	126,664	5.3	4,632		9.6%	443		3.50
2012 Acquisitions		36	1,202,865	5.2	98,850		9.5%	9,434		7.84
Portfolio - September 30, 2012(6)		124	2,198,877	6.8	$	235,723	8.5%	$	20,121	$	9.15

_______________________________________________

(1) Remaining lease term as of September 30, 2012, in years. If the portfolio has multiple locations with varying lease expirations, remaining lease term is calculated on a weighted-average basis. Total remaining lease term is a weighted average of the remaining lease term of the total portfolio.

(2) Original purchase price of the Contributed Properties and base purchase price of all other properties, in each case excluding acquisition and transaction-related costs. Acquisition and transaction-related costs include legal and various other closing costs incurred in connection with acquiring investment properties.

(3) Annualized rental income or annualized net operating income ("NOI"), on a straight-line basis, divided by base purchase price.

(4) Annualized rental income/NOI for net leases is rental income on a straight-line basis as of September 30, 2012, which includes the effect of tenant concessions such as free rent, as applicable. For modified gross leased properties, NOI is rental income on a straight-line basis as of September 30, 2012, which includes the effect of tenant concessions such as free rent, as applicable, plus operating expense reimbursement revenue less property operating expenses.

(5) Lease on property is a modified gross lease. As such, annualized rental income/NOI for this property is rental income on a straight-line basis as of September 30, 2012, which includes the effect of tenant concessions such as free rent plus operating expense reimbursement revenue less property operating expenses.

(6) Total portfolio excludes one vacant property contributed in September 2011, which is classified as held for sale as of September 30, 2012.

8

AMERICAN REALTY CAPITAL PROPERTIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2012

(Unaudited)

Future Lease Payments

The following table presents future minimum base rental cash payments due to the Company over the next five years and thereafter.  These amounts exclude contingent rent payments, as applicable, that may be collected from certain tenants based on provisions related to sales thresholds and increases in annual rent based on exceeding certain economic indexes among other items (amounts in thousands):

	Future Minimum Base Rent Payments
October 1, 2012 - December 31, 2012	$	4,980
2013	20,228
2014	20,416
2015	20,246
2016	19,858
Thereafter	72,222
	$	157,950

Tenant Concentration

The following table lists the tenants whose annualized rental income/NOI on a straight-line basis represented greater than 10% of consolidated annualized rental income/NOI on a straight-line basis as of September 30, 2012 and 2011:

Tenant	September 30, 2012	September 30, 2011
Citizens Bank	33.4%	75.0%
John Deere	11.7%	—%
GSA	11.4%	—%
Home Depot	11.2%	25.0%

The termination, delinquency or non-renewal of one or more leases by either of the above tenants may have a material effect on revenues. No other tenant represents more than 10% of the annualized rental income/NOI for the period presented.

Geographic Concentration

The following table lists the states where the Company has concentrations of properties where annual rental income/NOI on a straight-line basis represented greater than 10% of consolidated annualized rental income/NOI on a straight-line basis as of September 30, 2012 and 2011:

State	September 30, 2012		September 30, 2011
Michigan	14.2	%	22.7	%
South Carolina	12.4	%	25.0	%
Ohio	11.8	%	20.0	%
Iowa	11.7	%	*
New York	10.4	%	11.7	%

_______________________________________________

* The state's annualized rental income/NOI was not greater than 10% of total annualized rental income for all portfolio properties as of the period specified.

9

AMERICAN REALTY CAPITAL PROPERTIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2012

(Unaudited)

Note 4 — Senior Secured Revolving Credit Facility

On September 7, 2011, the Company closed on a senior secured revolving credit facility with RBS Citizens, N.A. Through an "accordion feature," subject to certain conditions, the Company may increase its total commitments under the credit facility to $150.0 million. The proceeds of advances made under the credit agreement may be used to finance the acquisition of net leased, investment or non-investment grade leased properties and for other permitted corporate purposes. Up to $10.0 million of the facility is available for letter of credits. The credit agreement has a term of 36 months and matures on September 7, 2014, subject to the Company's right to a 24-month extension.

Any advance made under the credit facility will bear floating interest at per annum rates equal to the one-month London Interbank Offered Rate (“LIBOR”) plus 2.15% to 2.90% depending on the Company's loan to value ratio as specified in the credit agreement. In the event of a default, the lender has the right to terminate its obligations under the credit agreement, including the funding of future advances, and to accelerate the payment on any unpaid principal amounts outstanding. The credit facility requires a fee of 0.15% on the unused balance if amounts outstanding under the facility are 50% or more of the total facility amount and 0.25% on the unused balance if amounts outstanding under the facility are less than 50% of the total facility amount.

As of September 30, 2012, there was $91.1 million outstanding on this facility, which bore an interest rate of 2.7%, collateralized by 95 properties. Additional borrowings may become available under this facility based upon the availability of additional collateral, among other factors. In September 2012, the Company expanded the facility to allow for additional future acquisitions. As a result, there was $18.9 million available for future acquisitions at September 30, 2012. As of December 31, 2011, there was $42.4 million outstanding on this facility with an interest rate of 3.17%, collateralized by 59 properties.

The Company’s sources of recourse financing generally require financial covenants, including restrictions on corporate guarantees, the maintenance of certain financial ratios (such as specified debt to equity and debt service coverage ratios) as well as the maintenance of a minimum net worth. As of September 30, 2012, the Company was in compliance with the debt covenants under the senior secured revolving credit facility agreement.

Note 5 — Mortgage Notes Payable

The Company’s mortgage notes payable consist of the following as of September 30, 2012 and December 31, 2011 (dollar amounts in thousands):

	Encumbered Properties	Outstanding Loan Amount		Weighted Average Effective Interest Rate(1)		Weighted Average Maturity(2)
September 30, 2012	29	$	35,760	4.52	%	3.77
December 31, 2011	28	$	30,260	4.67	%	4.32

_______________________________________________

(1) Mortgage notes payable have fixed rates. Effective interest rates range from 3.68% to 5.32% at September 30, 2012 and 3.80% to 5.32% at December 31, 2011.

(2) Weighted average remaining years until maturity as of September 30, 2012 and December 31, 2011, respectively.

10

AMERICAN REALTY CAPITAL PROPERTIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2012

(Unaudited)

The following table summarizes the scheduled aggregate principal repayments subsequent to September 30, 2012 (amounts in thousands):

	Total
October 1, 2012 - December 31, 2012	$	—
2013	74
2014	189
2015	13,767
2016	11,760
Thereafter	9,970
Total	$	35,760

The Company’s sources of recourse financing generally require financial covenants, including restrictions on corporate guarantees, the maintenance of certain financial ratios (such as specified debt to equity and debt service coverage ratios) as well as the maintenance of a minimum net worth. As of September 30, 2012, the Company was in compliance with the debt covenants under the mortgage loan agreements.

Note 6 — Fair Value of Financial Instruments

The Company determines fair value based on quoted prices when available or through the use of alternative approaches, such as discounting the expected cash flows using market interest rates commensurate with the credit quality and duration of the investment. The guidance defines three levels of inputs that may be used to measure fair value:

Level 1 — Quoted prices in active markets for identical assets and liabilities that the reporting entity has the ability to access at the measurement date.

Level 2 — Inputs other than quoted prices included within Level 1 that are observable for the asset and liability or can be corroborated with observable market data for substantially the entire contractual term of the asset or liability.

Level 3 — Unobservable inputs that reflect the entity’s own assumptions about the assumptions that market participants would use in the pricing of the asset or liability and are consequently not based on market activity, but rather through particular valuation techniques.

The determination of where an asset or liability falls in the hierarchy requires significant judgment and considers factors specific to the asset or liability. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company evaluates its hierarchy disclosures each quarter and depending on various factors, it is possible that an asset or liability may be classified differently from quarter to quarter. However, the Company expects that changes in classifications between levels will be rare.

Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with those derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by the Company and its counterparties. However, as of September 30, 2012, the Company has assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and has determined that the credit valuation adjustments are not significant to the overall valuation of the Company’s derivatives. As a result, the Company has determined that its derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy.

The Company is required to disclose the fair value of financial instruments for which it is practicable to estimate that value. The fair value of short-term financial instruments such as cash and cash equivalents, due to affiliates and accounts payable approximate their carrying value on the accompanying consolidated balance sheets due to their short-term nature.

11

AMERICAN REALTY CAPITAL PROPERTIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2012

(Unaudited)

The fair values of the Company’s financial instruments that are not reported at fair value on the consolidated balance sheet are reported below (amounts in thousands):

		Carrying Amount at		Fair Value at		Carrying Amount at		Fair Value at
	Level	September 30, 2012		September 30, 2012		December 31, 2011		December 31, 2011
Mortgage notes payable	3	$	35,760	$	35,794	$	30,260	$	30,626
Senior secured revolving credit facility	3	$	91,090	$	91,090	$	42,407	$	42,407

The fair value of mortgage notes payable are obtained by calculating the present value at current market rates. The interest rate of the senior secured revolving credit facility is determined by a variable market rate and the Company's leverage ratio, and each have terms commensurate with market; as such the outstanding balance on the facility approximates fair value.

Note 7 — Derivatives and Hedging Activities

Risk Management Objective of Using Derivatives

The Company may use derivative financial instruments, including interest rate swaps, caps, options, floors and other interest rate derivative contracts, to hedge all or a portion of the interest rate risk associated with its borrowings. The principal objective of such arrangements is to minimize the risks and/or costs associated with the Company's operating and financial structure as well as to hedge specific anticipated transactions. The Company does not intend to utilize derivatives for speculative or other purposes other than interest rate risk management. The use of derivative financial instruments carries certain risks, including the risk that the counterparties to these contractual arrangements are not able to perform under the agreements. To mitigate this risk, the Company only enters into derivative financial instruments with counterparties with high credit ratings and with major financial institutions with which the Company and its affiliates may also have other financial relationships. The Company does not anticipate that any of the counterparties will fail to meet their obligations.

Cash Flow Hedges of Interest Rate Risk

The Company's objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps and caps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. Interest rate caps designated as cash flow hedges involve the receipt of variable-rate amounts if interest rates rise above the cap strike rate on the contract.

The effective portion of changes in the fair value of derivatives designated and that qualify as cash flow hedges is recorded in accumulated other comprehensive income and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. During 2012, such derivatives were used to hedge the variable cash flows associated with forecasted variable-rate debt. The ineffective portion of the change in fair value of the derivatives is recognized directly in earnings. During the three and nine months ended September 30, 2012, the Company recorded no hedge ineffectiveness in earnings.

Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on the Company's variable-rate debt. During the next twelve months, the Company estimates that an additional $13,000 will be reclassified from other comprehensive income as an increase to interest expense.

As of September 30, 2012, the Company had the following outstanding interest rate derivative that was designated as cash flow hedge of interest rate risk (dollar amount in thousands).

Interest Rate Derivative	Number of Instruments	Notional Amount
Interest Rate Cap	1	$	50,000

12

AMERICAN REALTY CAPITAL PROPERTIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2012

(Unaudited)

The table below presents the fair value of the Company's derivative financial instruments as well as their classification on the balance sheet as of September 30, 2012. The Company had no derivatives as of December 31, 2011.

	Balance Sheet Location	September 30, 2012
Derivatives designated as hedging instruments:
Interest Rate Cap	Derivative, at fair value	$	—

The table below details the location in the financial statements of the gain or loss recognized on interest rate derivatives designated as cash flow hedges for the three and nine ended September 30, 2012 (amounts in thousands). The Company had no active derivatives for the three and nine months ended September 30, 2011.

	Three Months Ended				Nine Months Ended
	September 30, 2012		September 30, 2011		September 30, 2012			September 30, 2011
Amount of gain (loss) recognized in accumulated other comprehensive income on interest rate derivatives (effective portion)	$	—	$	—	$	(13	)	$	—
Amount of gain (loss) reclassified from accumulated other comprehensive income into income as interest expense (effective portion)	$	—	$	—	$	—		$	—
Amount of gain (loss) recognized in income on derivative instruments (ineffective portion and amounts excluded from effectiveness testing)	$	—	$	—	$	—		$	—

Note 8 — Convertible Preferred Stock

On May 11, 2012, the Company entered into a securities purchase agreement with an unaffiliated third party that is an “accredited investor” (as defined in Rule 501 of Regulation D as promulgated under the Securities Act of 1933, as amended) pursuant to which the Company sold 545,454 shares of the Company's Series A convertible preferred stock for gross proceeds of $6.0 million and aggregate net proceeds of $5.8 million after offering-related fees and expenses.

The Series A convertible preferred stock has a liquidation preference of $11.00 per share, plus accrued and unpaid dividends, and a redemption premium equal to one percent (1%). Commencing on May 31, 2012, the Company has been paying cumulative dividends on the Series A convertible preferred stock monthly in arrears at the annualized rate of $0.77 per share.

The Series A convertible preferred stock is convertible into the Company's common stock, at the option of the holder of the Series A convertible preferred stock, at a conversion price equal to $11.00 per share, beginning one year after the date of issuance. The Company, at its option at any time, may redeem the Series A convertible preferred stock, in whole or in part, at $11.00 per share.

On July 24, 2012, the Company entered into a securities purchase agreement with an unaffiliated third party that is an “accredited investor” (as defined in Rule 501 of Regulation D as promulgated under the Securities Act of 1933, as amended) pursuant to which the Company sold 283,018 shares of the Company's Series B convertible preferred stock for gross proceeds of approximately $3.0 million. After deducting offering-related fees and expenses, the aggregate net proceeds to the Company from the sale of the Series B convertible preferred stock were approximately $3.0 million.

The Series B convertible preferred stock has a liquidation preference of $10.60 per share, plus accrued and unpaid dividends, and a redemption premium equal to one percent (1%). Commencing on August 15, 2012, the Company has been paying cumulative dividends on the Series B convertible preferred stock monthly in arrears at an annualized rate of $0.74 per share.

The Series B convertible preferred stock is convertible into the Company's common stock, at the option of the holder of the Series B convertible preferred stock, at a conversion price equal to $10.60 per share, beginning one year after the date of issuance. The Company, at its option at any time, may redeem the Series B convertible preferred stock, in whole or in part, at $10.60 per share.

13

AMERICAN REALTY CAPITAL PROPERTIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2012

(Unaudited)

The Series A convertible preferred stock and the Series B convertible preferred stock each ranks senior to the Company's common stock and on parity with each other, and junior to any other preferred stock the Company may issue other than additional series of the Series A convertible preferred stock or Series B convertible preferred stock.

Note 9 — Common Stock

On September 7, 2011, the Company closed its IPO and issued 5.6 million shares of common stock. On November 2, 2011, the Company sold 1.5 million common shares in a follow-on offering. On November 7, 2011, the underwriters exercised their option to purchase additional shares of common stock, which totaled 0.1 million shares. On June 18, 2012, the Company sold in a follow-on offering a total of 3.25 million shares of common stock. On July 2, 2012, the underwriters of the follow-on offering exercised their option to purchase an additional 0.5 million shares of common stock, which closed on July 9, 2012.

As of September 30, 2012 and December 31, 2011, the Company had a total of 11.2 million and 7.3 million shares of common stock outstanding, including unvested restricted shares, and had received aggregate proceeds from common stock issuances of $118.9 million and $78.1 million, respectively.

On September 7, 2011, the Company’s Board of Directors authorized and the Company declared an annual dividend rate of $0.875 per share payable monthly in cash beginning in October 2011, on the fifteenth day of each month to stockholders of record at the close of business on the eighth day of such month.

On February 27, 2012, the Company’s Board of Directors authorized and the Company declared an annual dividend rate of $0.880 per share. Accordingly, on March 15, 2012, the Company paid a dividend of $0.0733 per share to stockholders of record at the close of business on March 8, 2012.

On March 16, 2012, the Company’s Board of Directors authorized and the Company declared an increase to the Company’s annual dividend rate to $0.885, beginning May 9, 2012. Accordingly, on June 15, 2012, the Company paid a dividend of $0.07375 per share to stockholders of record at the close of business on the June 8, 2012.

On June 27, 2012, the Company's Board of Directors authorized and the Company declared an increase to the Company's annual dividend rate to $0.890, beginning August 9, 2012. Accordingly, on September 15, 2012, the Company paid a dividend of $0.07417 per share to stockholders of record at the close of business on September 8, 2012.

On September 30, 2012, the Company's Board of Directors authorized and the Company declared an increase to the Company's annual dividend rate to $0.895 per share, beginning November 9, 2012. On November 15, 2012, the Company will pay a monthly dividend of $0.07458 per share to stockholders of record at the close of business on November 8, 2012.

Note 10 — Commitments and Contingencies

Litigation

In the ordinary course of business, the Company may become subject to litigation or claims. There are no material legal proceedings pending or known to be contemplated against the Company.

Environmental Matters

In connection with the ownership and operation of real estate, the Company may potentially be liable for costs and damages related to environmental matters. The Company does not own any properties subject to environmental-related issues, has not been notified by any governmental authority of any non-compliance, liability or other claim, and is not aware of any other environmental condition, in each case, that it believes will have a material adverse effect on the results of operations.

14

AMERICAN REALTY CAPITAL PROPERTIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2012

(Unaudited)

Note 11 — Related Party Transactions and Arrangements

Common Stock Ownership

Certain affiliates of the Company have purchased shares of the Company's common stock. As of September 30, 2012 and December 31, 2011, certain affiliates owned 19.4% and 31.3%, respectively, of the Company's common stock outstanding on a fully diluted basis, including the Contributor's 310,000 OP Units owned by the Company's Sponsor.

The Company has issued restricted stock to the Manager and non-executive directors in conjunction with a share-based compensation plan. See Note 13 — Share-Based Compensation.

Fees Paid in Connection with the Offering

RCS received selling commissions of 6% of the gross offering proceeds from the sale of the Company’s common stock in the IPO, which were entirely re-allowed to participating broker-dealers. In addition, RCS received dealer manager fees of 2% of the gross offering proceeds before reallowance to participating broker-dealers. RCS was permitted to re-allow all or a portion of its dealer manager fee to participating broker-dealers.

The following table details the results of such activities related to RCS (in thousands):

	Three Months Ended				Nine Months Ended
	September 30, 2012		September 30, 2011		September 30, 2012		September 30, 2011
Total commissions paid to affiliated Dealer Manager	$	—	$	919	$	—	$	919

The Company will reimburse the Manager for services relating to the IPO and the follow-on offerings. The following table details the results of such activities related to organizational and offering costs reimbursed to the Manager (amounts in thousands):

	Three Months Ended				Nine Months Ended
	September 30, 2012		September 30, 2011		September 30, 2012		September 30, 2011
Offering expense reimbursements	$	59	$	—	$	109	$	—

Fees Paid in Connection With the Operations of the Company

The Company will pay the Sponsor an acquisition fee equal to 1.0% of the contract purchase price (including assumed indebtedness) of each property the Company acquires which is originated by the Sponsor. The acquisition fee is payable in cash at the closing of each acquisition.

The Company will pay the Sponsor a financing fee equal to 0.75% of the amount available under any secured mortgage financing or refinancing that the Company obtains and uses for the acquisition of properties that is arranged by the Sponsor. The financing coordination fee is payable in cash at the closing of each financing.

The Company will pay the Manager an annual base management fee equal to 0.50% per annum of the average unadjusted book value of the Company's real estate assets, calculated and payable monthly in advance, provided that the full amount of the distributions declared by the Company for the six immediately preceding months is equal to or greater than certain net income thresholds related to our operations. Our Manager will waive such portion of its management fee in excess of such thresholds. The management fee is payable in cash. No such management fees have been incurred or paid to the Manager since inception.

15

AMERICAN REALTY CAPITAL PROPERTIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2012

(Unaudited)

The Company may be required to pay the Manager a quarterly incentive fee, calculated based on the Company's annualized earnings, weighted average number of shares and weighted average price per share of common stock. One half of each quarterly installment of the incentive fee will be payable in shares of common stock. The remainder of the incentive fee will be payable in cash. No such incentive fees have been incurred or paid to the Manager since inception.

The Company is required to reimburse the Sponsor for all out-of-pocket costs actually incurred by the Sponsor, including without limitation, legal fees and expenses, due diligence fees and expenses, other third party fees and expenses, costs of appraisals, travel expenses, nonrefundable option payments and deposits on properties not acquired, accounting fees and expenses, title insurance premiums and other closing costs, personnel costs and miscellaneous expenses relating to the selection, acquisition and due diligence of properties. The Company's reimbursement obligation is not subject to any dollar limitation. Expenses will be reimbursed in cash on a monthly basis following the end of each month. However, the Company will not reimburse the Sponsor for the salaries and other compensation of its personnel.

The following table details amounts incurred by the Company and contractually due to the Sponsor and the Manager and forgiven in connection with the operations related services described above (amounts in thousands):

	Three Months Ended				Three Months Ended
	September 30, 2012				September 30, 2011
	Incurred		Forgiven		Incurred		Forgiven
One-time fees:
Acquisition fees and related cost reimbursements	$	441	$	—	$	—	$	—
Financing fees and related cost reimbursements	369		—		—		—
Other expense reimbursements	45		—		—		—
On-going fees:
Base management fees	—		278		—		50
Incentive fees	—		—		—		—
Total operational fees and reimbursements	$	855	$	278	$	—	$	50

	Nine Months Ended				Nine Months Ended
	September 30, 2012				September 30, 2011
	Incurred		Forgiven		Incurred		Forgiven
One-time fees:
Acquisition fees and related cost reimbursements	$	1,703	$	—	$	—	$	—
Financing fees and related cost reimbursements	583		—		—		—
Other expense reimbursements	71		—		—		—
On-going fees:
Base management fees	—		664		—		50
Incentive fees	—		—		—		—
Total operational fees and reimbursements	$	2,357	$	664	$	—	$	50

Under an administrative support agreement between the Company and the Sponsor, the Sponsor will pay or reimburse the Company for its general administrative expenses, including, without limitation, legal fees, audit fees, board of directors fees, insurance, marketing and investor relation fees, until September 6, 2012, which was one year after the closing of the IPO, to the extent the amount of certain net earnings from operations thresholds, as specified in the agreement, is less than the amount of the distributions declared by the Company during this one-year period. To the extent these amounts are paid by the Sponsor, they would not be subject to reimbursement by the Company. These costs are presented net in the accompanying consolidated statements of operations and comprehensive loss.

16

AMERICAN REALTY CAPITAL PROPERTIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2012

(Unaudited)

The following table details general and administrative expenses absorbed by the Sponsor during the three and nine months ended September 30, 2012 (amounts in thousands).

	Three months ended		Nine months ended
	September 30, 2012		September 30, 2012
General and administrative expenses absorbed	$	—	$	164

The Company had a receivable from affiliates of $0.2 million at September 30, 2012, related to absorbed general and administrative expenses.

Note 12 — Economic Dependency

Under various agreements, the Company has engaged or will engage the Manager and its affiliates to provide certain services that are essential to the Company, including asset management services, supervision of the management and leasing of properties owned by the Company, asset acquisition and disposition decisions, the sale of shares of the Company’s common stock available for issue in follow-on offerings, as well as other administrative responsibilities for the Company including accounting services and investor relations.

As a result of these relationships, the Company is dependent upon the Manager, the Sponsor and their affiliates. In the event that these companies were unable to provide the Company with the respective services, the Company would be required to find alternative providers of these services.

Note 13 — Share-Based Compensation

Equity Plan

The Company has adopted the American Realty Capital Properties, Inc. Equity Plan (the "Equity Plan"), which provides for the grant of stock options, restricted shares of common stock, restricted stock units, dividend equivalent rights and other equity-based awards to the Manager, non-executive directors, officers and other employees and independent contractors, including employees or directors of the Manager and its affiliates who are providing services to the Company.

Under the Equity Plan, the Company's compensation committee is authorized to approve grants of equity-based awards to the Manager. Concurrently with the closing of the IPO, the Company granted to the Manager 167,400 restricted shares of common stock, which was equal to 3.0% of the number of shares of common stock sold through the IPO. This award of restricted shares vests ratably on a quarterly basis over a three-year period beginning on October 1, 2011. The Manager is entitled to receive “distribution equivalents” with respect to this restricted stock, whether or not vested, at the same time and in the same amounts as dividends are paid to the common stockholders, commencing on the first anniversary of the date of grant. The Manager will defer any distributions payable to it in connection with the restricted stock that it is granted under the Equity Plan until such time as the Company is covering the payment of distributions to the stockholders based on the criteria in the agreement, for the six immediately preceding months. In June 2012, the Company granted to the Manager an additional 93,683 restricted shares of common stock. In June 2012, the Manager distributed these 93,683 restricted shares of common stock to key personnel of an affiliate of the Manager. These restricted shares will vest annually over three years beginning in January 2013. In addition to these restricted stock grants, the Company may from time to time grant additional equity incentive awards to the Manager pursuant to the Equity Plan. The Manager may, in the future, allocate a portion of these awards or ownership or profits interests in it to officers or any other personnel of the Manager or other personnel of the Manager or its affiliates in order to provide incentive compensation to them. For the three and nine months ended September 30, 2012, compensation expense for restricted shares was $0.4 million and $0.7 million, respectively.

The Company authorized and reserved a total number of shares equal to 10.0% of the total number of issued and outstanding shares of common stock (on a fully diluted basis assuming the redemption of all OP Units for shares of common stock) to be issued at any time under the Equity Plan for equity incentive awards excluding the initial grant to the Manager. All such awards of shares will vest ratably on an annual basis over a three-year period beginning on the first anniversary of the date of grant and shall provide for “distribution equivalents” with respect to this restricted stock, whether or not vested, at the same time and in the same amounts as dividends are paid to the stockholders.

17

AMERICAN REALTY CAPITAL PROPERTIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2012

(Unaudited)

Director Stock Plan

Concurrently with the closing of the IPO, the Company granted 3,000 restricted shares of common stock to each of the Company's three independent directors, each of whom is a non-executive director, pursuant to the Director Stock Plan. Awards of restricted stock will vest ratably over a five-year period following the first anniversary of the date of grant in increments of 20.0% per annum, subject to the director’s continued service on the Board of Directors, and shall provide for “distribution equivalents” with respect to this restricted stock, whether or not vested, at the same time and in the same amounts as distributions are paid to the stockholders. At September 30, 2012, a total of 99,000 shares of common stock are reserved for issuance under the Director Stock Plan. As of September 30, 2012 and 2011, there were 16,200 and 9,000 unvested restricted shares (the "Directors' shares"), respectively, issued to independent directors under the Director Stock Plan. For the three and nine months ended September 30, 2012 and 2011, respectively, compensation expense for the vesting of Directors' shares was immaterial.

The following table details the restricted shares activity within the Equity Plan and Director Stock Plan during the nine months ended September 30, 2012:

	Equity Plan				Director Stock Plan
	Number of Common Shares		Weighted-Average Issue Price		Number of Common Shares		Weighted-Average Issue Price
Unvested, December 31, 2011	167,400		$	12.50	9,000		$	12.50
Granted	93,683		10.65		9,000		10.65
Vested	(59,556	)	12.41		(1,800	)	12.50
Unvested, September 30, 2012	201,527		$	12.50	16,200		$	11.47

Note 14 — Net Loss Per Share 

The following is a summary of the basic and diluted net loss per share computation for the three and nine months ended September 30, 2012 and 2011 (dollars in thousands, expect for shares and per share data):  

	Three Months Ended September 30,						Nine Months Ended September 30,
	2012			2011			2012			2011
Net loss from continuing operations attributable to stockholders	$	(763	)	$	(625	)	$	(3,034	)	$	(641	)
Less: dividends declared on preferred shares	(140		)	—			(210		)
Net loss from continuing operations attributable to common stockholders	(903		)	(625		)	(3,244		)	(641		)
Net loss from discontinued operations attributable to stockholders	(41		)	(9		)	(440		)	(9		)
Net loss attributable to common stockholders, net of dividends on preferred shares	$	(944	)	$	(634	)	$	(3,684	)	$	(650	)
Weighted average common shares outstanding	10,846,432			1,515,710			8,543,365			511,452
Basic and diluted net loss per share from continuing operations attributable to common stockholders	$	(0.08	)	$	(0.41	)	$	(0.38	)	$	(1.25	)
Basic and diluted net loss per share from discontinued operations attributable to stockholders	$	—		$	(0.01	)	$	(0.05	)	$	(0.02	)
Basic and diluted net loss per share attributable to common stockholders	$	(0.09	)	$	(0.42	)	$	(0.43	)	$	(1.27	)

As of September 30, 2012, the Company had 886,376 OP Units issued, which are convertible to an equal number of shares of the Company's common stock, 217,727 shares of unvested restricted stock outstanding, 545,454 shares of the Company's Series A preferred convertible stock outstanding and 283,018 shares of the Company's Series B preferred convertible stock outstanding, which were excluded from the calculation of diluted loss per share as the effect would have been antidilutive.

18

AMERICAN REALTY CAPITAL PROPERTIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2012

(Unaudited)

Note 15 — Discontinued Operations and Properties Held for Sale

The Company separately classifies properties held for sale in the accompanying consolidated balance sheets and operating results for those properties as discontinued operations in the accompanying consolidated statements of operations. In the normal course of business, changes in the market may compel the Company to decide to classify a property as held for sale or reclassify a property that is designated as held for sale back to held for investment. In these situations, the property is transferred to held for sale or back to held for investment at the lesser of fair value or depreciated cost. As of September 30, 2012 and December 31, 2011, the Company held one and two vacant properties, respectively, which were classified as held for sale on the accompanying respective balance sheets.

The Company sold one held for sale property during the three months ended September 30, 2012. See Note 3 — Real Estate Investments.

Note 16 — Subsequent Events

The Company has evaluated subsequent events through the filing of this Quarterly Report on Form 10-Q, and determined that there have been no events that have occurred that would require adjustments to our disclosures in the consolidated financial statements except for the transaction described below.

Completion of Acquisition of Assets

The following table presents certain information about the properties that the Company acquired from October 1, 2012 to October 26, 2012 (dollar amounts in thousands):

	No. of Buildings	Square Feet	Base Purchase Price (1)
Total Portfolio – September 30, 2012 (2)	124	2,198,877	$	235,723
Acquisitions	2	14,985	2,258
Total portfolio – October 26, 2012 (2)	126	2,213,862	$	237,981

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(1) Contract purchase price, excluding acquisition and transaction related costs.

(2) Total portfolio excludes one vacant property contributed in September 2011 which was classified as held for sale at September 30, 2012. The aggregate square footage and original base purchase price of this contributed vacant property was 3,200 and $1.2 million, respectively.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis should be read in conjunction with the accompanying financial statements of American Realty Capital Properties, Inc. (the “Company”) and the notes thereto. As used herein, the terms “we,” “our” and “us” refer to American Realty Capital Properties, Inc., a Maryland corporation, and, as required by context, to ARC Properties Operating Partnership, L.P. (the “OP”), a Delaware limited partnership and its subsidiaries. American Realty Capital Properties, Inc. is externally managed by ARC Properties Advisors, LLC (the “Manager”), a Delaware limited liability company, a wholly owned subsidiary of AR Capital, LLC (the “Sponsor”).

Forward-Looking Statements

This Quarterly Report on Form 10-Q includes forward-looking statements that reflect our expectations and projections about our future results, performance, prospects and opportunities. We have attempted to identify these forward-looking statements by using words such as “may,” “will,” “expects,” “anticipates,” “believes,” “intends,” “should,” "estimates," "could" or similar expressions. These forward-looking statements are based on information currently available to us and are subject to a number of known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. These factors include, among other things, those discussed below. We do not undertake publicly to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required to satisfy our obligations under federal securities law.

The following are some of the risks and uncertainties, although not all risks and uncertainties, that could cause our actual results to differ materially from those presented in our forward-looking statements:

• We and our Manager have a limited operating history and our Manager has limited experience operating a public company. This inexperience makes our future performance difficult to predict.

• All of our executive officers are also officers, managers or holders of a direct or indirect controlling interest in our Manager, the affiliated dealer manager of our IPO, as defined below, Realty Capital Securities, LLC ("RCS" or the "Dealer Manager") and other entities affiliated with the Sponsor. As a result, our executive officers, our Manager and its affiliates face conflicts of interest, including significant conflicts created by our Manager’s compensation arrangements with us and other investors advised by the Sponsor's affiliates and conflicts in allocating time among these investors and us. These conflicts could result in unanticipated actions.

• Because investment opportunities that are suitable for us may also be suitable for other programs advised by the Sponsor or such programs' investors, our Manager and its affiliates face conflicts of interest relating to the purchase of properties and other investments and such conflicts may not be resolved in our favor, meaning that we could invest in less attractive assets, which could reduce the investment return to our stockholders.

• The competition for the type of properties we desire to acquire may cause our dividends and the long-term returns of our investors to be lower than they otherwise would be.

• We may be unable to renew leases, lease vacant space or re-lease space as leases expire on favorable terms or at all, which could have a material adverse effect on our financial condition, results of operations, cash flow, cash available for dividends to our stockholders, per share trading price of our common stock and our ability to satisfy our debt service obligations.

• We depend on tenants for our revenue, and, accordingly, our revenue is dependent upon the success and economic viability of our tenants.

• Because we lease our properties to a limited number of tenants, and to the extent we depend on a limited number of tenants in the future, failure by any major tenant with leases in multiple locations to make rental payments to us, because of a deterioration of its financial condition or otherwise, or the termination or non-renewal of a lease by a major tenant, would have a material adverse effect on us.

• We are subject to tenant industry concentrations that make us more susceptible to adverse events with respect to certain industries.

• Increases in interest rates could increase the amount of our debt payments and limit our ability to pay dividends to our stockholders.

• We may be unable to make scheduled payments on our debt obligations.

• We may not generate cash flows sufficient to pay our dividends to stockholders, and as such we may be forced to borrow at higher rates or depend on our Manager to waive reimbursement of certain expenses and fees to fund our operations.

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• We may be unable to pay or maintain cash dividends or increase dividends over time.

• We are obligated to pay substantial fees to our Manager, our Sponsor and their affiliates.

• We are subject to risks associated with the significant dislocations and liquidity disruptions currently existing or occurring in the United States' credit markets.

• We may fail to qualify to be treated as a real estate investment trust for U.S. Federal income tax purposes (“REIT”).

• We may be deemed to be an investment company under the Investment Company Act of 1940, as amended, and thus subject to regulation under the Investment Company Act of 1940, as amended.

Overview

We were incorporated on December 2, 2010, as a Maryland corporation that qualified as a REIT for U.S. federal income tax purposes for the year ended December 31, 2011. On September 6, 2011, we sold in an IPO a total of 5.6 million shares of common stock. The shares began trading on the NASDAQ Capital Market (“NASDAQ”) under the symbol “ARCP” on September 7, 2011. As of September 30, 2012, we had 11.2 million shares of common stock outstanding, including unvested restricted shares and received aggregate proceeds from common stock issuances of $118.9 million. In addition, as of September 30, 2012, we had received aggregate proceeds of $9.0 million for the issuance of convertible preferred stock.

On August 1, 2012, we filed a universal shelf registration statement and a resale registration statement with the U.S. Securities and Exchange Commission (the "SEC").  Each registration statement became effective on August 17, 2012. The $500.0 million universal shelf registration statement, as amended, will enable us to grow our capital base over time while providing the flexibility to issue common stock, preferred stock, debt or equity-linked securities.  The universal shelf was sized to reflect our current expectation of growth over the next three years.  To date, no common stock, preferred stock, debt or equity-linked security has been issued under the universal shelf registration statement.  The resale registration statement, as amended, registers the resale of up to 1,882,248 shares of common stock issued in connection with any future conversion of certain currently outstanding restricted shares, convertible preferred stock or limited partnership interests. To date, no common stock has been issued under the resale registration statement.

We were formed to acquire and own single-tenant, freestanding commercial real estate primarily subject to medium-term net leases with high credit quality tenants. We consider properties that are net leased on a “medium-term basis” to mean properties originally leased long-term (ten years or longer) that currently have a primary remaining lease duration of generally three to eight years, on average.

Substantially all of our business is conducted through the OP. We are the sole general partner and holder of 92.5% of the equity interest in the OP. ARC Real Estate Partners, LLC (“the Contributor”) and an unaffiliated investor are the limited partners and owners of 2.6% and 4.9%, respectively, of the equity interest in the OP. After holding units of limited partner interests (“OP Units”) for a period of one year, holders of OP Units have the right to convert OP Units for the cash value of a corresponding number of shares of our common stock or, at the option of the OP, a corresponding number of shares of our common stock, as allowed by the limited partnership agreement of the OP. The remaining rights of the holders of OP Units are limited, however, and do not include the ability to replace the general partner or to approve the sale, purchase or refinancing of the OP’s assets.

We are managed by our affiliates, the Manager and Sponsor. The Sponsor provides certain acquisition and debt capital services to us. These related parties, including the Manager, the Sponsor and the Sponsor's wholly owned broker-dealer, RCS, have received compensation and fees for services provided to us, and will continue to receive compensation and fees and for investing, financing and management services provided to us.

As of September 30, 2012, excluding one vacant property classified as held for sale, we owned 124 properties consisting of 2.2 million square feet, 100% leased with a weighted average remaining lease term of 6.8 years. In constructing our portfolio, we are committed to diversification (industry, tenant and geography). As of September 30, 2012, rental revenues derived from investment grade tenants and tenants affiliated with investment grade entities as determined by a major rating agency approximated 99% (We have attributed the rating of each parent company to its wholly owned subsidiary for purposes of this disclosure.). Our strategy encompasses receiving the majority of our revenue from investment grade tenants as we further acquire properties and enter into (or assume) medium-term lease arrangements.

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Significant Accounting Estimates and Critical Accounting Policies

Set forth below is a summary of the significant accounting estimates and critical accounting policies that management believes are important to the preparation of our financial statements. Certain of our accounting estimates are particularly important for an understanding of our financial position and results of operations and require the application of significant judgment by our management. As a result, these estimates are subject to a degree of uncertainty. These significant accounting estimates include:

Revenue Recognition

Our revenues, which will be derived primarily from rental income, include rents that each tenant pays in accordance with the terms of each lease reported on a straight-line basis over the initial term of the lease. Since many leases will provide for rental increases at specified intervals, straight-line basis accounting requires us to record a receivable, and include in revenues, unbilled rent receivables that we will only receive if the tenant makes all rent payments required through the expiration of the initial term of the lease. We will defer the revenue related to lease payments received from tenants in advance of their due dates. Cost recoveries from tenants are included in tenant reimbursement income in the period the related costs are incurred, as applicable.

We review receivables related to rent and unbilled rent receivables and determine collectability by taking into consideration the tenant’s payment history, the financial condition of the tenant, business conditions in the industry in which the tenant operates and economic conditions in the area in which the property is located, as applicable. In the event that the collectability of a receivable is in doubt, we will record an increase in the allowance for uncollectible accounts or record a direct write-off of the receivable in the statement of operations.

Real Estate Investments

Upon the acquisition of properties, we will record acquired real estate at cost and make assessments as to the useful lives of depreciable assets. We will consider the period of future benefit of the asset to determine the appropriate useful lives. Depreciation will be computed using the straight-line method over the estimated useful lives of forty years for buildings, fifteen years for land improvements, five to seven years for building fixtures and improvements and the lesser of the useful life or remaining lease term for acquired intangible lease assets.

Allocation of Purchase Price of Acquired Assets

Upon the acquisition of real properties, it is our policy to allocate the purchase price of properties to acquired tangible assets, consisting of land, land improvements, buildings, fixtures and tenant improvements, and identified intangible lease assets and liabilities, consisting of the value of above-market and below-market leases, as applicable, the value of in-place leases and the value of tenant relationships, based in each case on their fair values. We utilize independent appraisals and information management obtains on each property as a result of pre-acquisition due diligence, as well as subsequent marketing and leasing activities, as applicable, to determine the fair values of the tangible assets of an acquired property, amongst other market data.

The fair values of above-market and below-market in-place lease values are recorded based on the present value (using an interest rate which reflects the risks associated with the leases acquired) of the difference between (a) the contractual amounts to be paid pursuant to the in-place leases and (b) an estimate of fair market lease rates for the corresponding in-place leases, which is generally obtained from independent appraisals, measured over a period equal to the remaining non-cancelable term of the lease. The above-market and below-market lease values are capitalized as intangible lease assets or liabilities. The capitalized above-market lease intangibles are amortized as a decrease to rental income over the remaining term of the lease. The capitalized below-market lease intangibles are amortized as an increase to rental income over the remaining term of the lease and any fixed rate renewal periods. In determining the amortization period for below-market lease intangibles, we initially consider, and periodically evaluate on a quarterly basis, the likelihood that a tenant will execute the renewal option. The likelihood that a lessee will execute the renewal option is determined by taking into consideration the tenant’s payment history, the financial condition of the tenant, business conditions in the industry in which the tenant operates and economic conditions in the area in which the property is located.

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The fair values of in-place leases include direct costs associated with obtaining a new tenant, opportunity costs associated with lost rentals which are avoided by acquiring an in-place lease, and tenant relationships. Direct costs associated with obtaining a new tenant include commissions, tenant improvements, and other direct costs and are estimated based on independent appraisals and management’s consideration of current market costs to execute a similar lease. The value of opportunity costs is calculated using the contractual amounts to be paid pursuant to the in-place leases over a market absorption period for a similar lease. Customer relationships are valued based on expected renewal of a lease or the likelihood of obtaining a particular tenant for other locations. These intangibles are included in intangible lease assets in the accompanying consolidated balance sheet and are amortized to depreciation and amortization, a component of operating expense, over the remaining term of the lease.

The determination of the fair values of the assets and liabilities acquired requires the use of significant assumptions with regard to the current market rental rates, rental growth rates, discount rates and other variables. The use of inappropriate estimates would result in an incorrect assessment of the purchase price allocations, which could impact the amount of our reported net income. Initial purchase price allocations are subject to change until all information is finalized, which is generally within one year of the acquisition date.

Derivative Instruments

We may use derivative financial instruments to hedge all or a portion of the interest rate risk associated with our borrowings. Certain of the techniques used to hedge exposure to interest rate fluctuations may also be used to protect against declines in the market value of assets that result from general trends in debt markets. The principal objective of such agreements is to minimize the risks or costs associated with our operating and financial structure as well as to hedge specific anticipated transactions.

We will record all derivatives on the balance sheet at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether we have elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Derivatives may also be designated as hedges of the foreign currency exposure of a net investment in a foreign operation. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk in a fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge. We may enter into derivative contracts that are intended to economically hedge certain risks, even though hedge accounting does not apply or we elect not to apply hedge accounting.

Recently Issued Accounting Pronouncements

Recently issued accounting pronouncements are described in Note 2 to our consolidated financial statements.

Results of Operations

We commenced operations in September 2011 in conjunction with the closing of our IPO. As of September 30, 2011, we owned 61 properties with an aggregate original base purchase price of $119.3 million, comprised of 0.8 million square feet, excluding two vacant properties. As of September 30, 2012, we owned 124 properties with an aggregate original base purchase price of $235.7 million, excluding one vacant property that was classified as held for sale. As of September 30, 2012, in total, the properties comprised 2.2 million square feet and were 100% leased. Prior to our IPO closing date, we did not hold any real estate properties, or have any sources of income. Accordingly, our results of operations for the three and nine months ended September 30, 2012, as compared to the three and nine months ended September 30, 2011 reflect significant increases in most categories.

Comparison of the Three Months Ended September 30,2012 to Three Months Ended September 30,2011

Rental Income

Rental income increased by $4.2 million for the three months endedSeptember 30, 2012 to $4.8 million compared to $0.6 million for the three months endedSeptember 30, 2011. Rental income was driven by our acquisition of 63 properties since September 30, 2011 for an aggregate purchase price of $116.4 million as well as revenue for a full three months from the 61 properties contributed in September 2011. The annualized rental income per square foot of the properties at September 30, 2012 was $9.15 with a weighted average remaining lease term of 6.8 years.

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Operating Expense Reimbursements

Operating expense reimbursements for the three months endedSeptember 30, 2012 were $0.1 million. Pursuant to certain of our lease agreements, tenants are required to reimburse us for certain property operating expenses, in addition to base rent, whereas under certain other lease agreements, the tenants are directly responsible for all operating costs of the respective properties. There was no operating expense reimbursement revenue for the three months endedSeptember 30, 2011, as the tenants in the properties we owned as of September 30, 2011 were directly responsible for all operating costs.

Acquisition and Transaction Related Costs

Acquisition and transaction related costs were $0.8 million for the three months endedSeptember 30, 2012. These costs related to the acquisition of six properties with an aggregate purchase price of $25.7 million. Acquisition and transaction related costs of $0.6 million for the three months endedSeptember 30, 2011, related to the 61 properties that were contributed with an aggregate original base purchase price of $119.3 million.

Property Expenses

Property expenses for the three months endedSeptember 30, 2012 were $0.3 million. These costs relate to expenses associated with maintaining certain properties, including real estate taxes, ground lease rent, insurance and repairs and maintenance expenses. There were no property expenses for the three months endedSeptember 30, 2011, as the tenants in the properties we owned as of September 30, 2011 were directly responsible for all operating costs.

General and Administrative Expenses

General and administrative expenses increased by $0.5 million to $0.6 million for the three months endedSeptember 30, 2012 compared to $0.1 million for the three months endedSeptember 30, 2011. General and administrative expenses primarily included the amortization of restricted stock, board member compensation and insurance expense, which increased to support our larger real estate portfolio.

Depreciation and Amortization Expense

Depreciation and amortization expense for the three months endedSeptember 30, 2012 was $2.8 million compared to $0.4 million for the three months endedSeptember 30, 2011. The increase in depreciation and amortization expense was driven by our acquisition of 63 properties since September 30, 2011 for an aggregate purchase price of $116.4 million as well as depreciation and amortization expense for a full three months from the 61 properties contributed in September 2011.

Interest Expense

Interest expense for the three months endedSeptember 30, 2012 of $1.1 million, primarily related to outstanding mortgage notes payable of $35.8 million and a weighted average effective interest rate of 4.5% as of September 30, 2012. Interest expense also related to our senior secured revolving credit facility with $91.1 million outstanding and an interest rate of 2.7% at September 30, 2012. Interest expense for the three months endedSeptember 30, 2011 of $0.2 million, primarily related to a mortgage note payable of $13.9 million and $51.5 million outstanding under the senior secured revolving credit facility as of September 30, 2011, both of which were outstanding as of the closing of our formation transaction in connection with the IPO, which occurred in September 2011.

Our interest expense in future periods will vary based on our level of future borrowings, which will depend on the level of proceeds raised in offerings, the cost of borrowings, and the opportunity to acquire real estate assets which meet our investment objectives.

Discontinued Operations

During the three months endedSeptember 30, 2012 and September 30, 2011, we had two vacant properties classified as held for sale on the balance sheet and reported in discontinued operations on the statements of operations. On July 3, 2012, one of these properties was sold for $0.6 million of net proceeds. During the three months endedSeptember 30, 2012 we had net income related to discontinued operations of $3,000, primarily due to refunded utility deposits. During the three months endedSeptember 30, 2011, we had $9,000 of net loss related to discontinued operations, primarily due to depreciation expense. Impairments on held for sale properties for the three months endedSeptember 30, 2012 of $47,000, represents the difference between the carrying value and estimated proceeds from the sale of the properties less estimated selling costs.

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Comparison of the Nine Months Ended September 30,2012 to Nine Months Ended September 30,2011

Rental Income

Rental income for the nine months endedSeptember 30, 2012 increased $10.4 million to $11.0 million, compared to $0.6 million for the nine months endedSeptember 30, 2011. Rental income was driven by our acquisition of 63 properties since September 30, 2011 for an aggregate purchase price of $116.4 million as well as revenue for a full nine months from the 61 properties contributed in September 2011.

Operating Expense Reimbursements

Operating expense reimbursements for the nine months endedSeptember 30, 2012 were $0.2 million. Pursuant to certain of our lease agreements, tenants are required to reimburse us for certain property operating expenses, in addition to base rent, whereas under certain other lease agreements, the tenants are directly responsible for all operating costs of the respective properties. There was no operating expense reimbursement revenue for the nine months endedSeptember 30, 2011, as the tenants in the properties we owned as of September 30, 2011 were directly responsible for all operating costs.

Acquisition and Transaction Related Costs

Acquisition and transaction related costs were $3.3 million for the nine months endedSeptember 30, 2012. These costs related to the acquisition of 36 properties with an aggregate purchase price of $98.9 million. Acquisition and transaction related costs of $0.6 million for the nine months endedSeptember 30, 2011, related to the 61 properties that were contributed with an aggregate original base purchase price of $119.3 million.

Property Expenses

Property expenses for the nine months endedSeptember 30, 2012 were $0.6 million. These costs relate to expenses associated with maintaining certain properties, including real estate taxes, ground lease rent, insurance and repairs and maintenance expenses. There were no property expenses for the nine months endedSeptember 30, 2011, as the tenants in the properties we owned as of September 30, 2011 were directly responsible for all operating costs.

General and Administrative Expenses

General and administrative expenses increased by $1.4 million to $1.5 million for the nine months endedSeptember 30, 2012 from $0.1 million for the nine months endedSeptember 30, 2011. General and administrative expenses primarily included the amortization of restricted stock, board member compensation, insurance expense and professional fees, which increased to support our larger real estate portfolio.

Depreciation and Amortization Expense

Depreciation and amortization expense increased $5.7 million to $6.1 million for the nine months endedSeptember 30, 2012 from $0.4 million for the nine months endedSeptember 30, 2011. The increase in depreciation and amortization expense was driven by our acquisition of 63 properties since September 30, 2011 for an aggregate purchase price of $116.4 million as well as depreciation and amortization expense for a full three months from the 61 properties contributed in September 2011.

Interest Expense

Interest expense for the nine months endedSeptember 30, 2012 of $2.9 million, primarily related to outstanding mortgage notes payable of $35.8 million and a senior secured revolving credit facility with $91.1 million outstanding as of September 30, 2012. Interest expense for the nine months endedSeptember 30, 2011 of $0.2 million primarily related to a mortgage note payable of $13.9 million and $51.5 million outstanding under the senior secured revolving credit facility as of September 30, 2011, both of which were only outstanding as of the closing of our formation transaction in connection with our IPO, which occurred in September 2011.

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Discontinued Operations

During the nine months endedSeptember 30, 2012 and September 30, 2011, we had two vacant properties classified as held for sale on the balance sheet and reported in discontinued operations on the statements of operations. On July 3, 2012, one of these properties was sold for $0.6 million of net proceeds. During the nine months endedSeptember 30, 2012 and 2011, we had a net loss related to discontinued operations of $12,000 and $9,000, respectively. Impairments on held for sale properties for the nine months endedSeptember 30, 2012 of $0.5 million represents the difference between the carrying value and estimated proceeds from the sale of the properties less estimated selling costs.

Cash Flows for the Nine Months Ended September 30,2012

During the nine months endedSeptember 30, 2012, net cash provided by operating activities was $3.4 million. The level of cash flows used in or provided by operating activities is affected by acquisition and transaction costs, the timing of interest payments and the amount of borrowings outstanding during the period, as well as the receipt of scheduled rent payments. Cash flows provided by operating activities for the nine months ended September 30, 2012 included $3.3 million in acquisition and transaction related costs. Cash flows provided by operating activities during the nine months endedSeptember 30, 2012 was mainly due to net income of $4.3 million (net loss of $3.6 million adjusted for non-cash items including depreciation and amortization, amortization of deferred financing costs, share based compensation and loss on held for sale properties of $7.9 million), an increase in deferred rent of $0.1 million and an increase in accounts payable and accrued expenses of $0.1 million, partially offset by an increase in prepaid and other assets of $1.1 million, primarily due to an increase in unbilled rent receivables in accordance with straight-line basis accounting.

Net cash used in investing activities for the nine months endedSeptember 30, 2012 of $91.9 million, primarily related to the acquisition of 36 properties with an aggregate purchase price of $98.9 million, paid for with cash of $92.5 million and the issuance of OP units of $6.4 million. This cash outflow for acquisitions was partially offset by the sale of one vacant property for net proceeds of $0.6 million.

Net cash provided by financing activities of $89.2 million during the nine months endedSeptember 30, 2012 related to $48.7 million of proceeds, net of repayments, from our senior secured revolving credit facility, $43.3 million of proceeds, net of offering-related costs, from the issuance of common and preferred stock and proceeds from mortgage notes payable of $5.5 million. These inflows were partially offset by distributions to common stockholders of $5.8 million, payments related to financing costs of $1.9 million, distributions to non-controlling interest holders of $0.4 million, and $0.2 million due from affiliated entities.

Cash Flows for the Nine Months Ended September 30,2011

During the nine months ended September 30, 2011, net cash provided by operating activities was $0.2 million. The level of cash flows used in or provided by operating activities is affected by acquisition and transaction costs, the timing of interest payments and the amount of borrowings outstanding during the period, as well as the receipt of scheduled rent payments. Cash flows provided by operating activities for the nine months ended September 30, 2011 included $0.6 million in acquisition and transaction related costs. Cash flows provided by operating activities during the nine months ended September 30, 2011 was mainly due to an increase in deferred rent of $0.7 million, which was partially offset by a net loss adjusted for non-cash items of $0.3 million (net loss of $0.7 million adjusted for depreciation and amortization of tangible and intangible real estate assets and amortization of deferred financing costs of $0.4 million), a decrease of $0.1 million in accounts payable and accrued expenses and an increase in prepaid and other assets of $48,000.

Net cash provided by financing activities of $0.6 million during the nine months ended September 30, 2011 related to proceeds from the issuance of common stock of $5.2 million and $0.3 million of proceeds from affiliated entities. These inflows were partially offset by payments related to offering costs of $3.9 million and payments related to financing costs of $1.0 million.

Liquidity and Capital Resources

In September 2011, we sold a total of 5.6 million shares of common stock in connection with our IPO. The shares began trading on NASDAQ under the symbol “ARCP” on September 7, 2011. We obtained our first 63 properties from the Contributor and commenced real estate operations in September 2011. As of September 30, 2012, we owned 124 properties with an aggregate original base purchase price of $235.7 million and one additional vacant property that was classified as held for sale.  

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We closed a follow-on offering on November 2, 2011 and sold 1.5 million shares of common stock. In addition, on November 7, 2011, the underwriters exercised their option to purchase an additional 0.1 million shares of common stock, which closed on November 7, 2011. On June 18, 2012, the Company sold in a follow-on offering a total of 3.25 million shares of common stock. In addition, on July 2, 2012, the underwriters exercised their option to purchase an additional 0.5 million shares, which closed on July 9, 2012. Through September 30, 2012, we have received net proceeds from the IPO and follow-on offerings of $118.9 million.

On May 11, 2012, we entered into a securities purchase agreement with an unaffiliated third party that is an “accredited investor” (as defined in Rule 501 of Regulation D as promulgated under the Securities Act of 1933, as amended) pursuant to which we sold 0.5 million shares of our Series A convertible preferred stock for gross proceeds of $6.0 million and aggregate net proceeds of $5.8 million after offering-related fees and expenses.

On July 24, 2012, we entered into a securities purchase agreement with an unaffiliated third party that is an “accredited investor” (as defined in Rule 501 of Regulation D as promulgated under the Securities Act of 1933, as amended) pursuant to which we sold 0.3 million shares of our Series B convertible preferred stock for proceeds of approximately $3.0 million. After deducting for offering-related fees and expenses, our aggregate net proceeds from the sale of our Series B convertible preferred stock were approximately $3.0 million.

On August 1, 2012, we filed a universal shelf registration statement and a resale registration statement with the SEC.  Each registration statement became effective on August 17, 2012. The $500.0 million universal shelf registration statement, as amended, will enable us to grow our capital base over time while providing the flexibility to issue common stock, preferred stock, debt or equity-linked securities.  The universal shelf was sized to reflect our current expectation of growth over the next three years.  To date, no common stock, preferred stock, debt or equity-linked security has been issued under the universal shelf registration statement.  The resale registration statement, as amended, registers the resale of up to 1,882,248 shares of common stock issued in connection with any future conversion of certain currently outstanding restricted shares, convertible preferred stock or limited partnership interests. To date, no common stock has been issued under the resale registration statement.

On September 7, 2011, we closed on a senior secured revolving credit facility with RBS Citizens, N.A. Through an "accordion feature," subject to certain conditions, we may increase the total commitments under the credit facility to $150.0 million. The proceeds of loans made under the credit agreement may be used to finance the acquisition of net leased, investment or non-investment grade occupied properties and for other permitted corporate purposes. Up to $10.0 million of the facility is available for letters of credit. The credit agreement has a term of 36 months and matures on September 7, 2014, subject to our right to a 24-month extension. As of September 30, 2012, we had $91.1 million outstanding under this facility, which bore an interest rate of 2.7%. As of September 30, 2012, this facility was collateralized by 95 properties. Additional borrowings may become available under this facility based upon the availability of additional collateral, among other factors. As of September 30, 2012, based on the collateral available, this facility was fully utilized. However, as of September 30, 2012, we have $18.9 million available to fund future acquisitions of properties, which may be placed under this facility as collateral when acquired.

Our principal demands for funds will continue to be for property acquisitions, either directly or through investment interests, for the payment of operating expenses, dividends to our investors, and for the payment of principal and interest on our outstanding indebtedness. We expect to meet our future short-term operating liquidity requirements through a combination of net cash provided by our current property operations and the operations of properties to be acquired in the future. The majority of our net leases contain contractual rent escalations during the primary term of the lease. Other potential future sources of capital include proceeds from secured or unsecured financings from banks or other lenders, proceeds from public and private offerings, proceeds from the sale of properties and undistributed funds from operations.

Acquisitions

Generally, cash needs for property acquisitions will be met through proceeds from the public or private stock offerings and financings. We may also from time to time enter into other agreements with third parties whereby third parties will make equity investments in specific properties or groups of properties that we acquire.

Our Manager evaluates potential acquisitions of real estate and real estate-related assets and engages in negotiations with sellers and borrowers on our behalf.  Investors and stockholders should be aware that after a purchase contract is executed that contains specific terms the property will not be purchased until the successful completion of due diligence and negotiation of final binding agreements. During this period, we may decide to temporarily invest any unused proceeds from common stock offerings in certain investments that could yield lower returns than the properties. These lower returns may affect our ability to make distributions.

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Funds from Operations and Adjusted Funds from Operations

 Due to certain unique operating characteristics of real estate companies, as discussed below, the National Association of Real Estate Investment Trusts, Inc. ("NAREIT"), an industry trade group, has promulgated a measure known as funds from operations ("FFO"), which we believe to be an appropriate supplemental measure to reflect the operating performance of a REIT. The use of FFO is recommended by the REIT industry as a supplemental performance measure. FFO is not equivalent to our net income or loss as determined under accounting principles generally accepted in the United States of America ("GAAP").

We define FFO, a non-GAAP measure, consistent with the standards established by the White Paper on FFO approved by the Board of Governors of NAREIT, as revised in February 2004 (the "White Paper"). The White Paper defines FFO as net income or loss computed in accordance with GAAP, excluding gains or losses from sales of property but including asset impairment writedowns, plus depreciation and amortization, after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures are calculated to reflect FFO. Our FFO calculation complies with NAREIT’s policy described above.

The historical accounting convention used for real estate assets requires straight-line depreciation of buildings and improvements, which implies that the value of real estate assets diminishes predictably over time, especially if such assets are not adequately maintained or repaired and renovated as required by relevant circumstances and/or is requested or required by lessees for operational purposes in order to maintain the value disclosed. We believe that, since real estate values historically rise and fall with market conditions, including inflation, interest rates, the business cycle, unemployment and consumer spending, presentations of operating results for a REIT using historical accounting for depreciation may be less informative. Historical accounting for real estate involves the use of GAAP. Any other method of accounting for real estate such as the fair value method cannot be construed to be any more accurate or relevant than the comparable methodologies of real estate valuation found in GAAP. Nevertheless, we believe that the use of FFO, which excludes the impact of real estate related depreciation and amortization, provides a more complete understanding of our performance to investors and to management, and when compared year over year, reflects the impact on our operations from trends in occupancy rates, rental rates, operating costs, general and administrative expenses, and interest costs, which may not be immediately apparent from net income. However, FFO and adjusted funds from operations ("AFFO"), as described below, should not be construed to be more relevant or accurate than the current GAAP methodology in calculating net income or in its applicability in evaluating our operating performance. The method utilized to evaluate the value and performance of real estate under GAAP should be construed as a more relevant measure of operational performance and considered more prominently than the non-GAAP FFO and AFFO measures and the adjustments to GAAP in calculating FFO and AFFO.

We consider FFO and FFO, as adjusted to exclude acquisition-related fees and expenses, or AFFO, useful indicators of the performance of a REIT. Because FFO calculations exclude such factors as depreciation and amortization of real estate assets and gains or losses from sales of operating real estate assets (which can vary among owners of identical assets in similar conditions based on historical cost accounting and useful-life estimates), they facilitate comparisons of operating performance between periods and between other REITs in our peer group. Accounting for real estate assets in accordance with GAAP implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values have historically risen or fallen with market conditions, many industry investors and analysts have considered the presentation of operating results for real estate companies that use historical cost accounting to be insufficient by themselves.

Additionally, we believe that AFFO, by excluding acquisition-related fees and expenses, provides information consistent with management's analysis of the operating performance of the properties. By providing AFFO, we believe we are presenting useful information that assists investors and analysts to better assess the sustainability of our operating performance. Further, we believe AFFO is useful in comparing the sustainability of our operating performance with the sustainability of the operating performance of other real estate companies, including exchange-traded and non-traded REITs.

As a result, we believe that the use of FFO and AFFO, together with the required GAAP presentations, provide a more complete understanding of our performance relative to our peers and a more informed and appropriate basis on which to make decisions involving operating, financing, and investing activities.

FFO and AFFO are non-GAAP financial measures and do not represent net income as defined by GAAP. FFO and AFFO do not represent cash flows from operations as defined by GAAP, are not indicative of cash available to fund all cash flow needs and liquidity, including our ability to pay distributions and should not be considered as alternatives to net income, as determined in accordance with GAAP, for purposes of evaluating our operating performance. Other REITs may not define FFO in accordance with the current NAREIT definition (as we do) or may interpret the current NAREIT definition differently than we do and/or calculate AFFO differently than we do. Consequently, our presentation of FFO and AFFO may not be comparable to other similarly titled measures presented by other REITs.

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The below table reflects the items deducted or added to net loss in our calculation of FFO and AFFO for the three and nine months ended September 30, 2012 (in thousands). Amounts are presented net of any non-controlling interest effect where applicable.

	Three Months Ended			Nine Months Ended
	September 30, 2012			September 30, 2012
Net loss attributable to stockholders (in accordance with GAAP)	$	(804	)	$	(3,474	)
Loss on held for sale properties	44			428
Depreciation and amortization	2,611			5,717
FFO	1,851			2,671
Acquisition and transaction related costs	707			3,060
Amortization of above-market lease asset	52			52
Amortization of deferred financing costs	202			495
Straight-line rent	(218		)	(555		)
Non-cash equity compensation expense	472			792
AFFO	$	3,066		$	6,515

Dividends

The amount of dividends payable to our stockholders is determined by our Board of Directors and is dependent on a number of factors, including funds available for dividends, financial condition, capital expenditure requirements, as applicable, and annual dividend requirements needed to qualify and maintain our status as a REIT under the Internal Revenue Code of 1986, as amended (the “Code”). Operating cash flows are expected to increase as additional properties are acquired in our investment portfolio.

We, our Board of Directors and Manager share a similar philosophy with respect to paying our dividends. The dividends should principally be derived from cash flows generated from real estate operations. In order to improve our operating cash flows and our ability to pay dividends from operating cash flows, our Manager agreed to waive certain fees including asset management and incentive fees. Our Manager will determine if a portion or all of such fees will be waived in subsequent periods on a quarter-to-quarter basis. Base asset management fees waived during the nine months endedSeptember 30, 2012 were $0.3 million; there were no incentive fees earned for the nine months endedSeptember 30, 2012. The fees that were waived relating to the activity during 2012 are not deferrals and accordingly, will not be paid. Because our Manager waived certain fees that we owed, cash flow from operations that would have been used to pay such fees to our Manager was available to pay dividends to our stockholders. See Note 11 — Related Party Transactions and Arrangements in the consolidated financial statements within this report for further information on fees paid to and forgiven by our Manager.

The management agreement with our Manager provides for payment of the asset management fee only if the full amount of the dividends declared by us for the six immediately preceding months is equal to or greater than the amount of our AFFO. Our Manager will waive such portion of its management fee that, when added to our AFFO, without regard to the waiver of the management fee, would increase our AFFO so that it equals the dividends declared by us for the prior six months. For purposes of this determination, AFFO is FFO (as defined by NAREIT), adjusted to (i) include acquisition fees and related expenses which is deducted in computing FFO; (ii) include non-cash restricted stock grant amortization, if any, which is deducted in computing FFO; and (iii) include impairments of real estate related investments, if any (including properties, loans receivable and equity and debt investments) which are deducted in computing FFO. Our Manager will determine if such fees will be partially or fully waived in subsequent periods on a quarter-to-quarter basis.

In addition, pursuant to our administrative support agreement with our Sponsor, our Sponsor had agreed to pay or reimburse us for certain of our general and administrative costs to the extent that the amount of our dividends declared until September 6, 2012, which was one year following the closing of our IPO exceed the amount of our AFFO in order that such dividends do not exceed the amount of our AFFO, computed without regard to such general and administrative costs paid for, or reimbursed, by our Sponsor.

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As our real estate portfolio matures, we expect cash flows from operations to cover our dividends. As the cash flows from operations become more significant, our Manager may discontinue its past practice of forgiving fees and may charge the entire fee in accordance with the agreement with our Manager. There can be no assurance that our Manager will continue to waive earned asset management or incentive fees in the future. 

The following table shows the sources for the payment of dividends to common stockholders for the three and nine months ended September 30, 2012 (dollars in thousands):

	Three Months Ended September 30, 2012					Nine Months Ended September 30, 2012
	Dividends			Percentage of Dividends		Dividends			Percentage of Dividends
Dividends paid in cash	$	2,413				$	5,554
Source of dividends:
Cash flows provided by operations (1)	2,256			93.5	%	3,417			61.5	%
Proceeds from financing activities	157			6.5	%	2,137			38.5	%
Total sources of dividends	$	2,413		100.0	%	$	5,554		100.0	%
Net loss attributable to stockholders (in accordance with GAAP)	$	(804	)			$	(3,474	)

____________________________________

(1) Dividends paid from cash provided by operations are derived from cash flows from operations (GAAP basis) for the three and nine months ended September 30, 2012. Cash flows provided by operations include $0.8 million and $3.3 million of acquisition and transaction related expenses incurred during the three and nine months ended September 30, 2012.

Loan Obligations

The payment terms of our loan obligations vary. In general, only interest amounts are payable monthly with all unpaid principal and interest due at maturity. Some of our loan agreements stipulate that we comply with specific reporting and financial covenants mainly related to debt coverage ratios and loan to value ratios. Each loan that has these requirements has specific ratio thresholds that must be met. As of September 30, 2012, we were in compliance with the debt covenants under our loan agreements.

As of September 30, 2012, we had non-recourse mortgage indebtedness secured by real estate of $35.8 million. Our mortgage indebtedness bore interest at weighted average rate of 4.52% per annum and had a weighted average maturity of 3.8 years. We may in the future incur additional mortgage debt on the properties we currently own or use long-term non-recourse financing to acquire additional properties in the future.

On September 7, 2011, we closed on a senior secured revolving credit facility with RBS Citizens, N.A. Through an "accordion feature," subject to certain conditions, we may increase the total commitments under the credit facility to $150.0 million. The proceeds of loans made under the credit agreement may be used to finance the acquisition of net leased, investment or non-investment grade occupied properties and for other permitted corporate purposes. Up to $10.0 million of the facility is available for letters of credit. The credit agreement has a term of 36 months and matures on September 7, 2014, subject to our right to a 24-month extension.

Any loan made under the credit facility shall bear floating interest at per annum rates equal to the one month London Interbank Offered Rate (“LIBOR”) plus 2.15% to 2.90% depending on our loan to value ratio as specified in the agreement. In the event of a default, the lender has the right to terminate its obligations under the credit agreement, including the funding of future loans, and to accelerate the payment on any unpaid principal amount of all outstanding loans. The line of credit requires a fee of 0.15% on the unused balance if amounts outstanding under the facility are 50% or more of the total facility amount and 0.25% on the unused balance if amounts outstanding under the facility are 50% or less of the total facility amount.

As of September 30, 2012, there was $91.1 million outstanding on this facility, which bore an interest rate of 2.7%, collateralized by 95 properties. Additional borrowings may become available under this facility based upon the availability of additional collateral, among other factors. In September 2012, we expanded the facility to allow for additional future acquisitions. As a result, we had $18.9 million available for future acquisitions as of September 30, 2012.

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As of September 30, 2012, we had aggregate indebtedness secured by real estate of $126.9 million, which was collateralized by 124 properties. At September 30, 2012, our corporate leverage ratio (total mortgage notes payable plus outstanding advances under our senior secured revolving credit facility less cash and cash equivalents divided by base purchase price of acquired properties) was 52.2%.

Contractual Obligations

The following is a summary of our contractual obligations as of September 30, 2012 (in thousands):

	Total		Remainder of 2012		2013 – 2014		2015 – 2016		Thereafter
Principal payments due on mortgage notes payable	$	35,760	$	—	$	263	$	25,527	$	9,970
Interest payments due on mortgage notes payable	5,941		403		3,220		2,163		155
Principal payments due on senior secured revolving credit facility	91,090		—		91,090		—		—
Interest payments due on senior secured revolving credit facility	4,761		615		4,146		—		—
Total	$	137,552	$	1,018	$	98,719	$	27,690	$	10,125

Election as a REIT

We qualified as a REIT under Sections 856 through 860 of the Code for U.S. federal income tax purposes for the year ended December 31, 2011. Shares of our common stock are subject to restrictions on ownership and transfer that are intended, among other purposes, to assist us in qualifying and maintaining our qualification as a REIT. Our charter, subject to certain exceptions, limits ownership to no more than 9.8% in value of the aggregate of our outstanding shares of stock and not more than 9.8% (in value or in number of shares, whichever is more restrictive) of any class or series of our shares of stock. Consistent with our charter, our Board of Directors has increased such ownership limits as they apply to our Sponsor and its affiliates to no more than 28.0%, and has further limited the ownership limits as they apply to everyone else to no more than 5.25%, in value of the aggregate of our outstanding shares of stock and in value or in number of shares, whichever is more restrictive, of any class or series of our shares of stock. Consistent with our charter, our Board of Directors has granted an exemption from the ownership limits and established an excepted holder limit with respect to the holders of our Series A convertible preferred stock and Series B convertible preferred stock as it relates to all outstanding Series A convertible preferred stock and Series B convertible preferred stock, respectively.

We intend to continue to operate in such a manner to qualify for taxation as a REIT, but no assurance can be given that we will operate in a manner so as to remain qualified as a REIT. If we continue to qualify for taxation as a REIT, we generally will not be subject to federal corporate income tax to the extent we distribute our REIT taxable income to our stockholders, and so long as we distribute at least 90% of our REIT taxable income. REITs are subject to a number of other organizational and operational requirements. Even if we continue to qualify for taxation as a REIT, we may be subject to certain state and local taxes on our income and property, and federal income and excise taxes on our undistributed income. We believe we are organized and operating in such a manner as to continue to qualify to be taxed as a REIT for the taxable year ending December 31, 2012. 

Inflation

We may be adversely impacted by inflation on any leases that do not contain indexed escalation provisions. In addition, our net leases may require the tenant to pay its allocable share of operating expenses, including common area maintenance costs, real estate taxes and insurance. This may reduce our exposure to increases in costs and operating expenses resulting from inflation.

Related-Party Transactions and Agreements

We have entered into agreements with affiliates, whereby we pay certain fees or reimbursements to our Sponsor, our Manager or their affiliates for acquisition fees and expenses, organization and offering costs, asset management fees and reimbursement of operating costs and have in the past paid sales commissions and dealer manager fees. See Note 11 — Related Party Transactions and Arrangements in our financial statements included in this report for a discussion of the various related-party transactions, agreements and fees.

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Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

The market risk associated with financial instruments and derivative financial instruments is the risk of loss from adverse changes in market prices or interest rates. Our market risk arises primarily from interest rate risk relating to variable-rate borrowings. To meet our short and long-term liquidity requirements, we borrow funds at a combination of fixed and variable rates. Our interest rate risk management objectives are to limit the impact of interest rate changes in earnings and cash flows and to lower our overall borrowing costs. To achieve these objectives, from time to time, we may enter into interest rate hedge contracts such as swaps, collars and treasury lock agreements in order to mitigate our interest rate risk with respect to various debt instruments. We would not hold or issue these derivative contracts for trading or speculative purposes. We do not have any foreign operations and thus we are not exposed to foreign currency fluctuations.

As of September 30, 2012, our debt included fixed-rate debt, including debt that has interest rates that are fixed with the use of derivative instruments, with a carrying value of $85.8 million and a fair value of $85.8 million. Changes in market interest rates on our fixed rate debt impact fair value of the debt, but they have no impact on interest incurred or cash flow. For instance, if interest rates rise 100 basis points and our fixed rate debt balance remains constant, we expect the fair value of our debt to decrease, the same way the price of a bond declines as interest rates rise. The sensitivity analysis related to our fixed-rate debt assumes an immediate 100 basis point move in interest rates from their September 30, 2012 levels, with all other variables held constant. A 100 basis point increase in market interest rates would result in a decrease in the fair value of our fixed rate debt by approximately $0.5 million. A 100 basis point decrease in market interest rates would result in an increase in the fair value of our fixed-rate debt by $0.6 million.

As of September 30, 2012, our debt included variable-rate debt with a carrying value of $41.1 million. The sensitivity analysis related to our variable-rate debt assumes an immediate 100 basis point move in interest rates from their September 30, 2012 levels, with all other variables held constant. A 100 basis point increase or decrease in variable interest rates on our variable-rate notes payable would increase or decrease our interest expense by $0.4 million annually.

As the information presented above includes only those exposures that existed as of September 30, 2012, it does not consider exposures or positions arising after that date. The information represented herein has limited predictive value. Future actual realized gains or losses with respect to interest rate fluctuations will depend on cumulative exposures, hedging strategies employed and the magnitude of the fluctuations.

These amounts were determined by considering the impact of hypothetical interest rate changes on our borrowing costs, and, assume no other changes in our capital structure.

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Item 4. Controls and Procedures.

Disclosure Controls and Procedures

In accordance with Rules 13a-15(b) and 15d-15(b) of the Securities Exchange Act, as amended (the "Exchange Act"), we, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, carried out an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) as of the end of the period covered by this Quarterly Report on Form 10-Q and determined that the disclosure controls and procedures are effective.

No change occurred in our internal controls over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) of the Exchange Act) during the three months ended September 30, 2012 that has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.

PART II — OTHER INFORMATION

Item 1. Legal Proceedings.

As of the end of the period covered by this Quarterly Report on Form 10-Q, we are not a party to, and none of our properties are subject to, any material pending legal proceedings.

Item 1A. Risk Factors.

There have been no material changes to the risk factors previously disclosed in the Amendment No. 1 to Form S-11 filed with the SEC on June 11, 2012, except for the item described below:

Dividends paid from sources other than our cash flow from operations, particularly from proceeds of financings, will result in us having fewer funds available for the acquisition of properties and other real estate-related investments and may dilute your interests in us, which may adversely affect our ability to fund future dividends with cash flow from operations and may adversely affect your overall return.

For the three months ended September 30, 2012, our dividends paid of $2.4 million was funded from $2.3 million of cash flow provided by operations and $0.1 million from proceeds of financings. For the nine months ended September 30, 2012, our dividends paid of $5.6 million was funded from $3.4 million of cash flow from operations and $2.2 million of proceeds from financings. Additionally, we may in the future pay dividends from sources other than from our cash flow from operations.

Until we acquire additional properties or other real estate-related investments, we may not generate sufficient cash flow from operations to pay dividends. Our inability to acquire additional properties or other real estate-related investments may result in a lower return on your investment than you expect. If we have not generated sufficient cash flow from our operations and other sources, such as from borrowings, the sale of additional securities, advances from our Sponsor, and/or our Manager's or our Sponsor's deferral, suspension and/or waiver of its fees and expense reimbursements, to fund distributions, we may use the proceeds from offerings of securities. Moreover, our board of directors may change our dividend distribution policy, in its sole discretion, at any time. Dividends made from offering proceeds are a return of capital to stockholders, from which we will have already paid offering expenses in connection with the applicable offering. We have not established any limit on the amount of proceeds from an offering that may be used to fund dividends, except that, in accordance with our organizational documents and Maryland law, we may not make dividend distributions that would: (1) cause us to be unable to pay our debts as they become due in the usual course of business; (2) cause our total assets to be less than the sum of our total liabilities plus senior liquidation preferences; or (3) jeopardize our ability to qualify as a REIT.

If we fund dividends from the proceeds of offerings of securities, we will have less funds available for acquiring properties or other real estate-related investments. As a result, the return you realize on your investment may be reduced. Funding dividends from borrowings could restrict the amount we can borrow for investments, which may affect our profitability. Funding dividends with the sale of assets or the proceeds of offerings of securities may affect our ability to generate cash flows. Funding dividends from the sale of additional securities could dilute your interest in us if we sell shares of our common stock or securities convertible or exercisable into shares of our common stock to third party investors. Payment of dividends from the mentioned sources could restrict our ability to generate sufficient cash flow from operations, affect our profitability and/or affect the dividends payable to you upon a liquidity event, any or all of which may have an adverse effect on your investment.

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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

On May 11, 2012, we entered into a securities purchase agreement with an unaffiliated third party that is an “accredited investor” (as defined in Rule 501 of Regulation D as promulgated under the Securities Act of 1933, as amended) pursuant to which we sold 0.5 million shares of our Series A convertible preferred stock for gross proceeds of $6.0 million and aggregate net proceeds of $5.8 million after offering-related fees and expenses.

On May 31, 2012, through our operating partnership, we issued 576,376 OP Units valued at approximately $6.4 million as partial consideration for the acquisition of the FedEx Freight distribution facilities. The OP Units were issued without registration in reliance on the exemption in Section 4(2) of the Securities Act of 1933, as amended, and Rule 506 of Regulation D thereunder, to an “accredited investor,” as that term is defined in Rule 501 of Regulation D, for transactions not involving a public offering.

On July 24, 2012, we entered into a securities purchase agreement with an unaffiliated third party that is an “accredited investor” (as defined in Rule 501 of Regulation D as promulgated under the Securities Act of 1933, as amended) pursuant to which we sold 0.3 million shares of our Series B convertible preferred stock for proceeds of approximately $3.0 million. After deducting for offering-related fees and expenses, our aggregate net proceeds from the sale of our Series B convertible preferred stock were approximately $3.0 million.

We have primarily used the net proceeds from the issuance of common and preferred stock to acquire single-tenant, freestanding commercial real estate primarily subject to medium-term net leases with high credit quality tenants. As of September 30, 2012, we have used the net proceeds from the issuance of common and preferred stock, revolving credit facility, and debt financings to purchase 124 properties with an aggregate purchase price of $235.7 million.

Item 3. Defaults Upon Senior Securities.

None

Item 4. Mine Safety Disclosures.

Not applicable

Item 5. Other Information.

None

Item 6. Exhibits.

The exhibits listed on the Exhibit Index (following the signatures section of this report) are included, or incorporated by reference, in this Quarterly Report on Form 10-Q.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

AMERICAN REALTY CAPITAL PROPERTIES, INC.

By: /s/ NICHOLAS S. SCHORSCH

Nicholas S. Schorsch

Chief Executive Officer and Chairman of the Board of Directors (Principal Executive Officer)

By: /s/ BRIAN S. BLOCK

Brian S. Block

Executive Vice President and Chief Financial Officer (Principal Financial Officer)

Date: October 29, 2012

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EXHIBITS

The following exhibits are included, or incorporated by reference, in this Quarterly Report on Form 10-Q for the nine months endedSeptember 30, 2012 (and are numbered in accordance with Item 601 of Regulation S-K):

Exhibit No.	Description
10.38 *	Second Amendment to Credit Agreement dated May 21, 2012
10.39 *	Third Amendment to Credit Agreement dated August 16, 2012
10.40 *	Fourth Amendment to Credit Agreement dated September 28, 2012
14 (1)	Code of Ethics
21 *	List of Subsidiaries
31.1 *	Certification of the Principal Executive Officer of the Company pursuant to Securities Exchange Act Rule 13a-14(a) or 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2 *	Certification of the Principal Financial Officer of the Company pursuant to Securities Exchange Act Rule 13a-14(a) or 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32 *	Written statements of the Principal Executive Officer and Principal Financial Officer of the Company pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101 *	XBRL (eXtensible Business Reporting Language). The following materials from American Realty Capital Properties, Inc.'s Quarterly Report on Form 10-Q for the three and nine months ended September 30, 2012, formatted in XBRL: (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations and Comprehensive Income, (iii) the Consolidated Statement of Changes in Equity, (iv) the Consolidated Statements of Cash Flows and (v) the Notes to Consolidated Financial Statements. As provided in Rule 406T of Regulation S-T, this information is furnished and not filed for purpose of Sections 11 and 12 of the Securities Act of 1933 and Section 18 of the Securities Exchange Act of 1934.

_______________________________________________

*        Filed herewith

(1)    Filed as an exhibit to the Company's Current Report on Form 8-K filed with the SEC on August 1, 2012.

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EX-10.38

SECOND AMENDMENT TO
CREDIT AGREEMENT

THIS SECOND AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is made and entered into as of this 21^st day of May, 2012 by and among ARC PROPERTIES OPERATING PARTNERSHIP, L.P., a Delaware limited partnership ("Borrower"), AMERICAN REALTY CAPITAL PROPERT J 1-,S, INC., a Maryland corporation and the sole member of the sole general partner of Borrower ("Parent") and RBS CITIZENS, N.A., a national banking association, as Administrative Agent for itself and its co-lenders, and as L/C Issuer (the "Bank").

WITNESSETH:

WHEREAS, Borrower, Parent and the Bank are parties to a certain Credit Agreement dated as of September 7, 2011, as amended by that certain First Amendment to Credit Agreement dated as of December 6, 2011 (the "First Amendment") (said Credit Agreement, as so amended by the First Amendment, and as from time to time may be further amended, modified, or restated, the "Credit Agreement"; and

WHEREAS, the Borrower has requested that the Bank amend certain terms and conditions of the Credit Agreement, including (a) to provide for an increase in the amount of the Aggregate Commitments from $53,000,000.00 to $75,000,000.00 and (b) to provide for certain extension options with respect to the Maturity Date of the Loan as set forth below in this Amendment; and

WHEREAS, the Bank has agreed to so amend certain terms and conditions of the Credit Agreement, all on the terms and conditions set forth below in this Amendment.

NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto hereby agree as follows:

1. Definitions. (a) All capitalized undefined terms used in this Amendment shall have the meanings ascribed thereto in the Credit Agreement, as amended hereby, and (b) "Second Amendment Effective Date" means the date of this Amendment.

2. Amendments to Credit Agreement.

a. Amendments to Article I of the Credit Agreement. Article I of the Credit Agreement, entitled "Definitions and Accounting Terms" is hereby modified and amended as follows:

i. Section 1.01 of the Credit Agreement, entitled "Defined Terms" is hereby modified and amended as follows:

By deleting in the entirety the definition of "Aggregate Commitments", as presently appearing therein, and by substituting in place thereof the following:

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"Aggregate Commitments" means the Commitments of all the Lenders, which, as of the Second Amendment Effective Date, total Seventy-Five Million Dollars ($75,000,000.00).

b) By adding the following new definitions (in alphabetical order) to the definitions presently appearing therein:

"First Amendment" means the First Amendment to Credit Agreement, dated as of December 6, 2011, among Borrower, Parent, the Administrative Agent and the Lenders.

"First Extended Maturity Date" means September 7, 2015.

"First Extension Effective Date" has the meaning specified in Section 2.14(a).

"Initial Maturity Date" means September 7, 2014.

"Maturity Date" means the Initial Maturity Date; provided, however: (a) if the Initial Maturity Date is extended to the First Extended Maturity Date pursuant to Section 2.14(a), then Maturity Date shall mean the First Extended Maturity Date, (b) if the First Extended Maturity Date is extended to the Second Extended Maturity Date pursuant to Section 2.14(b), then Maturity Date shall mean the Second Extended Maturity Date; provided further, however, that in each case if such date is not a Business Day then the applicable Maturity Date shall be the next preceding Business Date; all of the foregoing as may then be applicable as determined solely by Administrative Agent.

"Second Amendment Effective Date" means the "Second Amendment Effective Date" (as defined in the Second Amendment).

"Second Amendment" means the Second Amendment to Credit Agreement, dated as of May 21, 2012, among Borrower, Parent, the Administrative Agent and the Lenders.

"Second Extended Maturity Date" means September 7, 2016.

"Second Extension Effective Date" has the meaning specified in Section 2.14(b).

b. Amendment to Article II of the Credit Agreement. Article II of the Credit Agreement, entitled "The Commitments and Credit Extensions" is hereby modified and amended as follows:

i. By inserting the following new Section 2.14 immediately following Section 2.13, as presently appearing therein:

2.14 Extension of Maturity Date.

(a) First Extended Maturity Date.

(i) Request for Extension. Parent and Borrower may, by written notice to Administrative Agent (who shall promptly notify the Lenders) not

2

earlier than ninety (90) days and not later than sixty (60) days prior to the Initial Maturity Date, request that the Initial Maturity Date be extended to the First Extended Maturity Date.

(ii) Effectiveness of Extension. If so extended, then the Initial Maturity Date shall be extended to the First Extended Maturity Date, effective as of the Initial Maturity Date or such earlier date that Administrative Agent shall have determined that the Borrower shall have met the conditions set forth herein, (the "First Extension Effective Date") subject further to the Borrower's continued satisfaction of such conditions as of the Initial Maturity Date as set forth below. Administrative Agent, Parent, and Borrower shall promptly confirm to the Lenders such extension. As a condition precedent to such extension, (i) Parent and Borrower shall deliver to Administrative Agent a certificate of each Loan Party dated as of the First Extension Effective Date (in sufficient copies for each Lender) signed by a Responsible Officer of each Loan Party (A) providing evidence satisfactory to Administrative Agent that each Loan Party has taken all necessary action to authorize such extension and (B) in the case of Parent and Borrower, certifying that, before and after giving effect to such extension, (I) the representations and warranties contained in the Loan Documents are true and correct in all material respects on and as of the First Extension Effective Date and (as applicable) the Initial Maturity Date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects as of such earlier date, and except that for purposes of this Section 2.14(a), the representations and warranties contained in Section 6.05(b) shall be deemed to refer to the most-recent statements furnished pursuant to Section 7.01(b), and (II) no Default exists before or after giving effect to such extension; and (ii) Borrower shall have paid to Administrative Agent, for the account of each Lender, an extension fee in an amount equal to thirty-five basis points (0.35%) times such Lender's Commitment.

(b) Second Extended Maturity Date.

(i) Request for Extension. Parent and Borrower may, by written notice to Administrative Agent (who shall promptly notify the Lenders) not earlier than ninety (90) days and not later than sixty (60) days prior to the First Extended Maturity Date, request that the First Extended Maturity Date be extended to the Second Extended Maturity Date.

(ii) Effectiveness of Extension. If so extended, then the First Maturity Date shall be extended to the Second Extended Maturity Date, effective as of the First Extended Maturity Date or such earlier date that Administrative Agent shall have determined that the Borrower shall have met the conditions set forth herein, (the "Second Extension Effective Date") subject further to the Borrower's continued satisfaction of such conditions as of the First Extended Maturity Date as set forth below. Administrative Agent, Parent, and Borrower shall promptly confirm to the Lenders such extension. As a condition precedent to such extension, (i) Parent and Borrower shall deliver to Administrative Agent a certificate of each Loan Party dated as of the Second Extension Effective Date (in sufficient copies for each Lender) signed by a Responsible Officer of each Loan Party (A) providing evidence satisfactory to Administrative Agent that each Loan Party has taken all necessary action to authorize such extension and (B) in the case of Parent and Borrower, certifying that, before and after giving effect to such extension, (I) the representations and warranties contained in the

3

Loan Documents are true and correct in all material respects on and as of the Second Extension Effective Date and (as applicable) the First Extended Maturity Date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects as of such earlier date, and except that for purposes of this Section 2.14(b), the representations and warranties contained in Section 6.05(b) shall be deemed to refer to the most-recent statements furnished pursuant to Section 7.01(b), and (II) no Default exists before or after giving effect to such extension; and (ii) Borrower shall have paid to Administrative Agent, for the account of each Lender, a further extension fee in an amount equal to thirty-five basis points (0.35%) times such Lender's Commitment.

(c) Conflicting Provisions. This Section 2.14 shall supersede any provisions in Section 11.01 to the contrary.

c. Amendment to Article IV of the Credit Agreement. Article IV of the Credit Agreement, entitled "Borrowing Base" is hereby modified and amended as follows:

i. By deleting in the entirety the existing text of Section 4.08, entitled "Appraisals", as presently appearing therein, and by substituting in place thereof the following:

4.08 Appraisals. Administrative Agent will be entitled to obtain, and shall obtain at the request of the Required Lenders, at Borrower's expense, a new Acceptable Appraisal for any Borrowing Base Property whose most-recent Acceptable Appraisal is more than eighteen (18) months old; provided that in addition to the foregoing, Administrative Agent will be entitled to obtain, and at the request of Required Lenders shall obtain, at Borrower's expense, additional Acceptable Appraisals of any Borrowing Base Property or any part thereof if (i) an Event of Default has occurred and is continuing at the time Administrative Agent orders such Acceptable Appraisal, (ii) Borrower has exercised the option to extend the Initial Maturity Date to the First Extended Maturity Date pursuant to Section 2.14(a), (iii) Borrower has exercised the option to extend the First Extended Maturity Date to the Second Extended Maturity Date pursuant to Section 2.14(b), or (iv) an appraisal is required under applicable Law.

d. Amendment to Article VI of the Credit Agreement. Article II of the Credit Agreement, entitled "Representations and Warranties" is hereby modified and amended as follows:

i. By inserting the following new Section 6.25 immediately following Section 6.24, as presently appearing therein:

6.25 Patriot Act and Other Specified Laws.

(a) To the extent applicable, each Loan Party is in compliance, in all material respects, with the (i) Trading with the Enemy Act, and each of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V) and any other enabling legislation or executive order relating thereto, and (ii) the Act. No part of the proceeds of the Loans will be used, directly or indirectly, in violation in any material respect of the United States Foreign Corrupt Practices Act of

4

1977. No Loan Party is engaged in or has engaged in any course of conduct that could reasonably be expected to subject any of its properties to any Lien, seizure or other forfeiture under any criminal law, racketeer influenced and corrupt organizations or other similar criminal laws. No Loan Party is named on the list of Specially Designated Nationals and Blocked Persons maintained by the United States Department of Treasury Office of Foreign Assets Control.

(b) No Loan Party (i) is a Person whose property or interest in property is blocked or subject to blocking pursuant to Section 1 of Executive Order 13224 of September 23, 2001 Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg. 49079 (2001)), (ii) engages in any dealings or transactions prohibited by Section 2 of such Executive Order, or, to the knowledge of the Borrower after due inquiry, is otherwise associated with any such Person in any manner that violates such Section 2 and (iii) is a Person on the list of Specially Designated Nationals and Blocked Persons or subject to the limitations or prohibitions under any other U.S. Department of Treasury's Office of Foreign Assets Control regulation or executive order."

e. Amendment to Schedules to Credit Agreement. The Schedules to the Credit Agreement, as presently appearing therein, are hereby modified and amended as follows:

i. In Schedule 2.01 to the Credit Agreement, entitled "COMMITMENTS AND APPLICABLE PERCENTAGES", by deleting each reference to "53,000,000.00" in the text, as presently appearing therein, and by substituting in place thereof the figure "75,000,000.00";

References to Credit Agreement. Any and all references in the Loan Documents to the "Credit Agreement" (however defined or described) shall mean and refer to the Credit Agreement as hereby modified and amended.

3. Further Assurances. The Loan Parties shall take any and all such actions and execute any and all such instruments and agreements as the Bank shall reasonably request for the purpose of effectuating this Amendment.

4. Limited Amendment; Ratification of Loan Documents. Except as specifically amended hereby, the terms and conditions of the Credit Agreement and the other Loan Documents shall remain in full force and effect, and are hereby ratified and affirmed in all respects by each of the Loan Parties. This Amendment shall not be deemed a waiver of, or consent to, or a modification or amendment of, any other term or condition of the Credit Agreement or any other Loan Document, except as expressly set forth herein.

5. Representations and Warranties.

a. The representations and warranties of Borrower and each other Loan Party, contained in Article VI of the Credit Agreement or any other Loan Document are true and correct in all material respects (except to the extent that any such representation and warranty is qualified as to "materiality," "Material Adverse Effect" or similar language, in which case it shall be true and correct in all

5

respects (after giving effect to any such qualification)) on and as of the Second Amendment Effective Date; provided, if any such representations and warranties specifically refer to an earlier date, they shall be true and correct in all material respects (except to the extent that any such representation and warranty is qualified as to "materiality," "Material Adverse Effect" or similar language, in which case it shall be true and correct in all respects (after giving effect to any such qualification)) as of such earlier date.

b. Without limiting the generality of the foregoing, in connection with the execution and delivery of this Amendment, Borrower shall provide Administrative Agent with the following:

i. An updated Schedule 4.01, with respect to all Borrowing Base Properties as of the Second Amendment Effective Date;

ii. An updated Schedule 6.13, with respect to all Subsidiaries and other Equity Investments and Equity Interests as of the Second Amendment Effective Date.

All representations and warranties of Borrower and each other Loan Party, as contained in the Credit Agreement or any other Loan Document shall at all times be applicable with respect to the items set forth in said updated Schedule 4.01 and Schedule 6.13 as of the Second Amendment Effective Date (notwithstanding any existing references in the Credit Agreement or other Loan Documents to the prior Schedule 4.01 and Schedule 6.13 as of the Closing Date).

6. Waiver of Claims. Each Loan Party acknowledges and agrees that as of the date hereof, it
does not have any claims, counterclaims, offsets, or defenses against the Bank directly or indirectly relating to such Loan Party's relationship with, and/or the Obligations under, the Loan Documents, and to the extent that such Loan Party currently has or ever had prior to the date hereof any such claims, counterclaims, offsets, or defenses against the Bank, such Loan Party affirmatively WAIVES the same and, on behalf of itself and its representatives, successors and assigns, hereby RELEASES, and forever discharges the Bank and its officers, directors, agents, servants, attorneys, and employees, and their respective representatives, successors and assigns, of, to, and from all known debts, demands, actions, suits, accounts, covenants, contracts, agreements, damages, and any and all claims, demands, or liabilities whatsoever, of every name and nature, both at law and in equity through the date hereof related to the same.

7. Governing Law. This Amendment shall be governed by and construed in accordance with
the laws of the State of New York.

8. Counterparts. This Amendment may be executed in any number of counterparts, which
shall together constitute an entire original agreement, and shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.

6

9. Miscellaneous. This Second Amendment may be executed in any number of counterparts, which shall together constitute an entire original agreement, and shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. This Second Amendment expresses the entire understanding of the parties with respect to the transactions contemplated hereby. No prior negotiations or discussions shall limit, modify, or otherwise affect the provisions hereof. Any determination that any provision of this Second Amendment or any application hereof is invalid, illegal or unenforceable in any respect and in any instance shall not affect the validity, legality, or enforceability of such provision in any other instance, or the validity, legality, or enforceability of any other provisions of this Second Amendment. The Loan Parties represent and warrant that they have consulted with independent legal counsel of their selection in connection herewith and are not relying on any representations or warranties of the Administrative Agent or the Lenders or their counsel in entering into this Second Amendment.

[remainder of page left intentionally blank]

7

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the day and year first above written.

BORROWER:

ARC PROPERTIES OPERATING

PARTNERSHIP, L.P., a Delaware limited

partnership

By: /s/ Edward M. Weil, Jr

Name: Edward M. Weil, Jr.

Title: President

PARENT:

AMERICAN REALTY CAPITAL

PROPERTIES, INC., a Maryland corporation

By: /s/ Edward M. Weil, Jr

Name: Edward M. Weil, Jr.

Title: President

RBS CITIZENS, N.A., as Administrative Agent

for itself and its co-lenders as L/C Issuer and as

Lender

By:                                                      

Name:

Title:

Second Amendment to ARCP Credit Agreement

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the day and year first above written.

BORROWER:

ARC PROPERTIES OPERATING

PARTNERSHIP, L.P., a Delaware limited partnership

By:                                                      

Name: Edward M. Weil, Jr.

Title: President

PARENT:

AMERICAN REALTY CAPITAL

PROPERTIES, INC., a Maryland corporation

By:                                                      

Name: Edward M. Weil, Jr.

Title: President

RBS CITIZENS, N.A., as Administrative Agent for itself and its co-lenders as L/C Issuer and as Lender

By: /s/ Donald Woods

Name: Donald Woods

Title: SVP

Second Amendment to ARCP Credit Agreement

The undersigned, American Realty Capital Properties, Inc., as Guarantor under that certain Parent Guaranty Agreement dated as of September 7, 2011, hereby consents to the foregoing Second Amendment to Credit Agreement and acknowledges and agrees that the Parent Guaranty Agreement executed by the undersigned dated as of September 7, 2011 remains in full force and effect.

AMERICAN REALTY CAPITAL

PROPERTIES, INC., a Maryland corporation

By: /s/ Edward M. Weil, Jr

Name: Edward M. Weil, Jr.

Title: President

Second Amendment to ARCP Credit Agreement

Each of the undersigned, as Guarantor under that certain Subsidiary Guaranty Agreement dated as of September 7, 2011, hereby consents to the foregoing Second Amendment to Credit Agreement and acknowledges and agrees that the Subsidiary Guaranty Agreement executed by the undersigned dated as of September 7, 2011 remains in full force and effect.

American Realty Capital Partners, LLC

ARC Income Properties III, LLC

CRE JV Mixed Five CT Branch Holdings LLC

CRE JV Mixed Five IL 2 Branch Holdings LLC

CRE JV Mixed Five IL 3 Branch Holdings LLC

CRE JV Mixed Five IL 4 Branch Holdings LLC

CRE JV Mixed Five IL 5 Branch Holdings LLC

CRE JV Mixed Five MI 1 Branch Holdings LLC

CRE JV Mixed Five MI 2 Branch Holdings LLC

CRE-JV Mixed Five MI 3 Branch Holdings LLC

CRE JV Mixed Five MI 4 Branch Holdings LLC

CRE JV Mixed Five MI 5 Branch Holdings LLC

CRE JV Mixed Five MI 6 Branch Holdings LLC

CRE JV Mixed Five MI 7 Branch Holdings LLC

CRE JV Mixed Five NH Branch Holdings LLC

CRE JV Mixed Five OH 1 Branch Holdings LLC

CRE JV Mixed Five OH 2 Branch Holdings LLC

CRE JV Mixed Five OH 3 Branch Holdings LLC

CRE JV Mixed Five OH 4 Branch Holdings LLC

CRE JV Mixed Five OH 5 Branch Holdings LLC

CRE JV Mixed Five OH 6 Branch Holdings LLC

CRE JV Mixed Five OH 7 Branch Holdings LLC

CRE JV Mixed Five VT Branch Holdings LLC,

ARCP DGBLVAR001, LLC

ARCP DGCRLAR001, LLC

ARCP DGGRFAR001, LLC

ARCP DGJNBIL001, LLC

ARCP AAFNTMI001, LLC

ARCP AAYLNMI001, LLC

ARCP DGLSNM0001, LLC

ARCP DGASGM0001, LLC

ARCP DGBRNM0001, LLC

ARCP DGCTNM0001, LLC

ARCP DGASDM0001, LLC

ARCP DGDMDM0001, LLC

ARCP DGBLFM0001, LLC

ARCP DGAPC1VI0001, LLC

ARCP DGCMROK001, LLC

ARCP WGMRBSC001, LLC

ARCP WGEPTMI001, LLC

Second Amendment to ARCP Credit Agreement

ARCP GSFRENY001, LLC

ARC Income Properties, LLC,

each a Delaware limited liability company

By:   /s/ Edward M. Weil, Jr.

Name: Edward M. Weil, Jr.

Title: President

ARC TRS Corp., a Delaware corporation

By:   /s/ Edward M. Weil, Jr.

Name: Edward M. Weil, Jr.

Title: President

Second Amendment to ARCP Credit Agreement

EX-10.39

THIRD AMENDMENT TO
CREDIT AGREEMENT

THIS THIRD AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is made and entered into as of this 16th_ day of August, 2012 by and among ARC PROPERTIES OPERATING PARTNERSHIP, L.P., a Delaware limited partnership ("Borrower"), AMERICAN REALTY CAPITAL PROPERTIES, INC., a Maryland corporation and the sole member of the sole general partner of Borrower ("Parent") and RBS CITIZENS, N.A., a national banking association ("RBS Citizens"), as Administrative Agent for itself and its co-lenders, and as L/C Issuer (RBS Citizens, in its respective capacities under the Credit Agreement and the other Loan Documents, being referred to herein as the "Bank").

WITNESSETH:

WHEREAS, Borrower, Parent and the Bank are parties to a certain Credit Agreement dated as of September 7, 2011, as amended by that certain First Amendment to Credit Agreement dated as of December 6, 2011 (the "First Amendment"), as further amended by that certain Second Amendment to Credit Agreement dated as of May 21, 2012 (the "Second Amendment") (said Credit Agreement, as so amended by the First Amendment and the Second Amendment, and as from time to time may be further amended, modified, or restated, the "Credit Agreement"; and

WHEREAS, the Borrower has requested that the Bank amend certain terms and conditions of the Credit Agreement, including to provide for an increase in the amount of the Aggregate Commitments from $75,000,000.00 to $81,500,000.00, as set forth below in this Amendment; and

WHEREAS, the Bank has agreed to so amend certain terms and conditions of the Credit Agreement, all on the terms and conditions set forth below in this Amendment.

NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto hereby agree as follows:

1. Definitions. (a) All capitalized undefined terms used in this Amendment shall have the meanings ascribed thereto in the Credit Agreement, as amended hereby, and (b) "Third Amendment Effective Date" means the date of this Amendment.

2. Amendments to Credit Agreement.

a. Amendments to Article I of the Credit Agreement. Article I of the Credit Agreement, entitled "Definitions and Accounting Terms" is hereby modified and amended as follows:

i. Section 1.01 of the Credit Agreement, entitled "Defined Terms" is hereby modified and amended as follows:

a) By deleting in the entirety the definition of "Aggregate Commitments", as presently appearing therein, and by substituting in place thereof the following:

1

"Aggregate Commitments" means the Commitments of all the Lenders, which, as of the Third Amendment Effective Date, total Eighty-One Million Five Hundred Thousand Dollars ($81,500,000.00).

b) By deleting in the entirety the definition of "Borrowing Base", as presently appearing therein, and by substituting in place thereof the following:

"Borrowing Base" means, as of any date of determination, the lesser of (a) the roduct of (i) sixty-five percent (65%), times (ii) the aggregate Borrowing Values of the Borrowing Base Properties, and (b) the Implied Loan Amount. Notwithstanding the foregoing, (a) the amount of the Borrowing Base attributable to any Dark Property shall not exceed ten percent (10%) of the Borrowing Base, and (b) any Borrowing Value or Borrowing Base NOI from the Home Depot Property shall no longer be included in the Borrowing Base after September 7, 2012.

c) By adding the following new definitions (in alphabetical order) to the definitions presently appearing therein:

"Third Amendment Effective Date" means the "Third Amendment Effective Date" (as defined in the Third Amendment).

"Third Amendment" means the Third Amendment to Credit Agreement, dated as of August 16, 2012, among Borrower, Parent, the Administrative Agent and the Lenders.

b. Amendment to Schedules to Credit Agreement. The Schedules to the Credit Agreement, as presently appearing therein, are hereby modified and amended as follows:

i. In Schedule 2.01 to the Credit Agreement, entitled "COMMITMENTS AND APPLICABLE PERCENTAGES", by deleting each reference to "75,000,000.00" in the text, as presently appearing therein, and by substituting in place thereof the figure "81,500,000.00";

c. References to Credit Agreement. Any and all references in the Loan Documents to the "Credit Agreement" (however defined or described), including, without limitation, with respect to the Obligations evidenced by the Note, shall mean and refer to the Credit Agreement as hereby modified and amended. T

3. Further Assurances. The Loan Parties shall take any and all such actions and execute any
and all such instruments and agreements as the Bank shall reasonably request for the purpose of effectuating this Amendment.

4. Limited Amendment; Ratification of Loan Documents. Except as specifically amended hereby, the terms and conditions of the Credit Agreement and the other Loan Documents shall remain in full force and effect, and are hereby ratified and affirmed in all respects by each of the Loan Parties. This Amendment shall not be deemed a waiver of, or

2

consent to, or a modification or amendment of, any other term or condition of the Credit Agreement or any other Loan Document, except as expressly set forth herein.

5. Representations and Warranties.

a. The representations and warranties of Borrower and each other Loan Party, contained in Article VI of the Credit Agreement or any other Loan Document are true and correct in all material respects (except to the extent that any such representation and warranty is qualified as to "materiality," "Material Adverse Effect" or similar language, in which case it shall be true and correct in all respects (after giving effect to any such qualification)) on and as of the Third Amendment Effective Date; provided, if any such representations and warranties specifically refer to an earlier date, they shall be true and correct in all material respects (except to the extent that any such representation and warranty is qualified as to "materiality," "Material Adverse Effect" or similar language, in which case it shall be true and correct in all respects (after giving effect to any such qualification)) as of such earlier date.

b. Without limiting the generality of the foregoing, in connection with the execution and delivery of this Amendment, Borrower shall provide Administrative Agent with the following:

i. An updated Schedule 4.01, with respect to all Borrowing Base Properties as of the Third Amendment Effective Date;

ii. An updated Schedule 6.13, with respect to all Subsidiaries and other Equity Investments and Equity Interests as of the Third Amendment Effective Date.

All representations and warranties of Borrower and each other Loan Party, as contained in the Credit Agreement or any other Loan Document shall at all times be applicable with respect to the items set forth in said updated Schedule 4.01 and Schedule 6.13 as of the Third Amendment Effective Date (notwithstanding any existing references in the Credit Agreement or other Loan Documents to the prior Schedule 4.01 and Schedule 6.13 as of the Closing Date).

6. Regarding Mortgage and other Collateral. The respective indebtedness, liabilities, and other Obligations of the Loan Parties under the Loan Documents, as modified or otherwise provided herein, are and shall continue to be secured by each of the Mortgages, and any and all other Collateral as set forth under the Loan Documents.

7. Waiver of Claims. Each Loan Party acknowledges and agrees that as of the date hereof, it does not have any claims, counterclaims, offsets, or defenses against the Bank directly or indirectly relating to such Loan Party's relationship with, and/or the Obligations under, the Loan Documents, and to the extent that such Loan Party currently has or ever had prior to the date hereof any such claims, counterclaims, offsets, or defenses against the Bank, such Loan Party affirmatively WAIVES the same and, on behalf of itself and its

3

representatives, successors and assigns, hereby RELEASES, and forever discharges the Bank and its officers, directors, agents, servants, attorneys, and employees, and their respective representatives, successors and assigns, of, to, and from all known debts, demands, actions, suits, accounts, covenants, contracts, agreements, damages, and any and all claims, demands, or liabilities whatsoever, of every name and nature, both at law and in equity through the date hereof related to the same.

8. Modification Fee. In connection with the execution and delivery of this Amendment by the Bank, the Loan Parties hereby acknowledge and agree that the Bank shall have fully earned a "Modification Fee" (so referred to herein) payable by the Borrower in the amount of $65,000.00, which Modification Fee shall be in addition to any and all other fees and other amounts paid and/or to be paid by the Borrower and/or any other Loan Party pursuant to this Amendment or the other Loan Documents. The Modification Fee shall be due and payable in full in connection with the execution and delivery of this Amendment in good and sufficient funds immediately available to the Bank. Without limiting the generality of the foregoing, the Modification Fee shall in all events constitute Obligations secured by each Mortgage.

9. Reimbursement of Fees and Expenses. Without limiting the terms and conditions of the Credit Agreement and the other Loan Documents, Borrower hereby agrees to pay to the Bank on demand all of Lender's reasonable legal, and other out-of-pocket fees and expenses incurred by the Bank in connection with its due diligence and the negotiation, preparation, and execution of this Agreement and all documents, instruments, and agreements incidental thereto and contemplated herein.

10. Conditions to Effectiveness. The agreements of the Bank hereunder shall not be effective until each of the following conditions precedent has been fulfilled to the satisfaction of the Bank:

a. This Amendment and all instruments, documents, and agreements contemplated herein shall have been duly executed and delivered by the respective parties hereto and, shall be in full force and effect and shall be in form and substance reasonably satisfactory to the Bank, including, without limitation, satisfaction of the conditions set forth in Section 4.06 of the Credit Agreement with respect to the additional Mortgages being granted to the Bank in connection with the execution and delivery of this Amendment.

b. All action on the part of the Loan Parties necessary for the valid execution, delivery and performance, respectively, by the Loan Parties pursuant to this Amendment and all instruments, documents, and agreements contemplated herein shall have been duly and effectively taken.

c. The Borrower shall have paid the Modification Fee.

d. The Borrower shall have paid all attorneys' reasonable fees and expenses and all title insurance premiums incurred with respect to the additional Mortgages being

4

granted to the Bank in connection with the execution and delivery of this Amendment.

e. The Bank shall have received such other certificates, documents, instruments, opinions, consents, waivers, information, materials and/or agreements as the Bank shall reasonably require in form and substance satisfactory in all respects to the Bank.

11. Governing Law. This Amendment shall be governed by and construed in accordance with the laws of the State of New York.

12. Counterparts. This Amendment may be executed in any number of counterparts, which shall together constitute an entire original agreement, and shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.

13. Miscellaneous. This Amendment may be executed in any number of counterparts, which shall together constitute an entire original agreement, and shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. This Amendment expresses the entire understanding of the parties with respect to the transactions contemplated hereby. No prior negotiations or discussions shall limit, modify, or otherwise affect the provisions hereof. Any determination that any provision of this Amendment or any application hereof is invalid, illegal or unenforceable in any respect and in any instance shall not affect the validity, legality, or enforceability of such provision in any other instance, or the validity, legality, or enforceability of any other provisions of this Amendment. The Loan Parties represent and warrant that they have consulted with independent legal counsel of their selection in connection herewith and are not relying on any representations or warranties of the Administrative Agent or the Lenders or their counsel in entering into this Amendment.

[remainder of page left intentionally blank]

5

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the day and year first above written.

BORROWER:

ARC PROPERTIES OPERATING

PARTNERSHIP, L.P., a Delaware limited partnership

By: /s/ Jesse C. Galloway         

Name: Jesse C. Galloway

Title: Authorized Signatory

PARENT:

AMERICAN REALTY CAPITAL

PROPERTIES, INC., a Maryland corporation

By: /s/ Jesse C. Galloway         

Name: Jesse C. Galloway

Title: Authorized Signatory

Third Amendment to ARCP Credit Agreement

RBS CITIZENS, N.A., as Administrative Agent
for itself and its co-lenders as L/C Issuer and as
Lender

By: /s/ Donald Woods______

Name: Donald Woods

Title: SVP

Third Amendment to ARCP Credit Agreement

The undersigned, American Realty Capital Properties, Inc., as Guarantor under that certain Parent Guaranty Agreement dated as of September 7, 2011, hereby consents to the foregoing Third Amendment to Credit Agreement and acknowledges and agrees that the Parent Guaranty Agreement executed by the undersigned dated as of September 7, 2011 remains in full force and effect.

AMERICAN REALTY CAPITAL

PROPERTIES, INC., a Maryland corporation

By: /s/ Jesse C. Galloway         

Name: Jesse C. Galloway

Title: Authorized Signatory

Third Amendment to ARCP Credit Agreement

Each of the undersigned, as Guarantor under that certain Subsidiary Guaranty Agreement dated as of September 7, 2011, hereby consents to the foregoing Third Amendment to Credit Agreement and acknowledges and agrees that the Subsidiary Guaranty Agreement executed by the undersigned dated as of September 7, 2011 remains in full force and effect.

American Realty Capital Partners, LLC

ARC Income Properties III, LLC

CRE JV Mixed Five CT Branch Holdings LLC

CRE JV Mixed Five IL 2 Branch Holdings LLC

CRE JV Mixed Five IL 3 Branch Holdings LLC

CRE JV Mixed Five IL 4 Branch Holdings LLC

CRE JV Mixed Five IL 5 Branch Holdings LLC

CRE JV Mixed Five MI 1 Branch Holdings LLC

CRE JV Mixed Five MI 2 Branch Holdings LLC

CRE JV Mixed Five MI 3 Branch Holdings LLC

CRE JV Mixed Five MI 4 Branch Holdings LLC

CRE JV Mixed Five MI 5 Branch Holdings LLC

CRE JV Mixed Five MI 6 Branch Holdings LLC

CRE JV Mixed Five MI 7 Branch Holdings LLC

CRE JV Mixed Five NH Branch Holdings LLC

CRE JV Mixed Five OH 1 Branch Holdings LLC

CRE JV Mixed Five OH 2 Branch Holdings LLC

CRE JV Mixed Five OH 3 Branch Holdings LLC

CRE JV Mixed Five OH 4 Branch Holdings LLC

CRE JV Mixed Five OH 5 Branch Holdings LLC

CRE JV Mixed Five OH 6 Branch Holdings LLC

CRE JV Mixed Five OH 7 Branch Holdings LLC

CRE JV Mixed Five PA Branch Holdings LLC

CRE JV Mixed Five VT Branch Holdings LLC

ARCP DGBLVAR001, LLC

ARCP DGCRLAR001, LLC

ARCP DGGRFAR001, LLC

ARCP DGJNBIL001, LLC

ARCP AAFNTMI001, LLC

ARCP AAYLNMI001, LLC

ARCP DGLSNM0001, LLC

ARCP DGASGM0001, LLC

ARCP DGBRNM0001, LLC

ARCP DGCTNM0001, LLC

ARCP DGASDM0001, LLC

ARCP DGDMDM0001, LLC

ARCP DGBLFM0001, LLC

ARCP DGAPCM0001, LLC

ARCP DGCMROK001, LLC

Third Amendment to ARCP Credit Agreement

ARCP WGMRBSC001, LLC

ARCP WGEPTMI001, LLC

ARCP GSFRENY001, LLC

ARCP JIMPTIA01, LLC

ARC FEMTVIL001, LLC

ARC FEEVLIN001, LLC

ARC FEMTPPA001, LLC

ARC FECCTOH001, LLC

ARC FELDNKY002, LLC

ARC FEKKEIL001, LLC

ARC Income Properties, LLC,

each a Delaware limited liability company

By: /s/ Jesse C. Galloway         

Name: Jesse C. Galloway

Title: Authorized Signatory

ARC TRS Corp,. a Delaware corporation

By: /s/ Jesse C. Galloway         

Name: Jesse C. Galloway

Title: Authorized Signatory

Third Amendment to ARCP Credit Agreement

EX-10.40

FOURTH AMENDMENT TO
CREDIT AGREEMENT

THIS FOURTH AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is made and entered into as of September 28, 2012 by and among ARC PROPERTIES OPERATING PARTNERSHIP, L.P., a Delaware limited partnership ("Borrower"), AMERICAN REALTY CAPITAL PROPERTIES, INC., a Maryland corporation and the sole member of the sole general partner of Borrower ("Parent"), RBS CITIZENS, N.A., a national banking association ("RBS Citizens") and CAPITAL ONE, NATIONAL ASSOCIATION, a national banking association ("Capital One") as "Lenders", and RBS Citizens in its respective capacities "Administrative Agent" for itself and the other Lenders under the Credit Agreement (defined below) and as "L/C Issuer" (as each of such quoted terms are defined in the Credit Agreement and so referred to herein).

WITNESSETH:

WHEREAS, Borrower, Parent, Administrative Agent, Lenders, and L/C Issuer are parties to a certain Credit Agreement dated as of September 7, 2011, as amended by that certain First Amendment to Credit Agreement dated as of December 6, 2011 (the "First Amendment"), as further amended by that certain Second Amendment to Credit Agreement dated as of May 21, 2012 (the "Second Amendment"), as further amended by that certain Third Amendment to Credit Agreement dated as of August 16, 2012 (the "Third Amendment") (said Credit Agreement, as so amended by the First Amendment, the Second Amendment, the Third Amendment, and as from time to time may be further amended, modified, or restated, the "Credit Agreement"; and

WHEREAS, the Borrower has requested that Administrative Agent, Lenders, and L/C Issuer (singly and collectively, "Lender Party" or "Lender Parties") amend certain terms and conditions of the Credit Agreement, including to provide for an increase in the amount of the Aggregate Commitments from $81,500,000.00 to $110,000,000.00 (and a reduction to the amount of the Commitment of RBS Citizens from $81,500,000.00 to $75,000,000.00) as set forth below in this Amendment; and

WHEREAS, Lender Parties agreed to so amend certain terms and conditions of the Credit Agreement, all on the terms and conditions set forth below in this Amendment.

NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto hereby agree as follows:

1. Definitions. (a) All capitalized undefined terms used in this Amendment shall have the meanings ascribed thereto in the Credit Agreement, as amended hereby, and (b) "Fourth Amendment Effective Date" means the effective date of this Amendment.

2. Amendments to Credit Agreement.

a.	Amendments to Article I of the Credit Agreement. Article I of the Credit
	Agreement, entitled "Definitions and Accounting Terms" is hereby modified and amended as follows:

i. Section 1.01 of the Credit Agreement, entitled "Defined Terms" is hereby modified and amended as follows:

1

a) By deleting in the entirety the definition of "Aggregate Commitments", as presently appearing therein, and by substituting in place thereof the following:

"Aggregate Commitments" means the Commitments of all the Lenders, which, as of the Fourth Amendment Effective Date, total One Hundred Ten Million Dollars ($110,000,000.00).

b) By deleting in the entirety the definition of "Acceptable Property", as presently appearing therein, and by substituting in place thereof the following:

"Acceptable Property" means a Property (a) that is approved by Administrative Agent and meets the following requirements, or (b) that is approved by Administrative Agent and the Lenders:

(i)such Property is wholly-owned by, or ground leased pursuant to an Acceptable Ground Lease to, Borrower or a Subsidiary Guarantor free and clear of any Liens (other than Liens permitted by Section 8.01);

(ii)such Property is a retail, industrial and/or office property located within the United States which is one hundred percent (100%) leased and occupied by a single tenant or has an Occupancy Rate of at least ninety percent (90%), with any Property which is leased to a single tenant having a lease expiration no earlier than December 31, 2015;

(iii)if such Property is owned by, or ground leased pursuant to an Acceptable Ground Lease to, a Subsidiary Guarantor, then the Equity Interests of such Subsidiary Guarantor are owned, directly or indirectly by Borrower, free and clear of any Liens other than Liens permitted by Section 8.01; and

(iv)after giving effect to the addition of such Property as a Borrowing Base Property, such Property, together with all other Borrowing Base Properties, in the aggregate, shall not result in: (1) more than twenty-five percent (25%) of the total number of Borrowing Base Properties being located in any single MSA or (2) more than twenty-five percent (25%) of the Appraised Value of the total Borrowing Base Properties being attributable to Properties located in any single MSA.

c) By adding the following new definitions (in alphabetical order) to the definitions presently appearing therein:

"Fourth Amendment Effective Date" means the "Fourth Amendment Effective Date" (as defined in the Fourth Amendment).

"Fourth Amendment" means the Fourth Amendment to Credit Agreement, dated as of September 28, 2012, among Borrower, Parent, Administrative Agent, Lenders, and L/C Issuer.

2

"MSA" means, with respect to any Borrowing Base Property, the metropolitan statistical area applicable to such Borrowing Base Property, as reasonably determined by Administrative Agent from time to time.

b. Amendment to Article X of the Credit Agreement. Article X of the Credit Agreement, entitled "Administrative Agent" is hereby modified and amended as follows:

i. Section 10.07 of the Credit Agreement, entitled "Non-Reliance on Administrative Agent and Other Lenders" is hereby modified and amended as follows:

a) By adding the following text immediately following the last sentence of the existing text as presently appearing therein:

Without limiting the foregoing, Administrative Agent has complied with and will continue to comply with all provisions of the Flood Disaster Protection Act, and all regulations thereunder, with respect to all of the Borrowing Base Properties.

c. Amendment to Schedules to Credit Agreement. The Schedules to the Credit Agreement, as presently appearing therein, are hereby modified and amended as follows:

i. By deleting in the entirety the existing Schedule 2.01 to the Credit Agreement, entitled "COMMITMENTS AND APPLICABLE PERCENTAGES", by substituting in place thereof the amended Schedule 2.01 to the Credit Agreement attached as EXHIBIT A to this Amendment.

ii. By deleting in the entirety the existing Schedule 11.02 to the Credit Agreement, entitled "ADMINISTRATIVE AGENT'S OFFICE; CERTAIN ADDRESSES FOR NOTICES", by substituting in place thereof the amended Schedule 11.02 to the Credit Agreement attached as EXHIBIT B to this Amendment.

d. References to Credit Agreement. From and after the Fourth Amendment Effective Date, any and all references in the Loan Documents to the "Credit Agreement" (however defined or described), including, without limitation, with respect to the Obligations evidenced by each Note, shall mean and refer to the Credit Agreement as hereby modified and amended.

3. Additional Note.

a. Additional Note. In connection with the execution and delivery of this Amendment, and in addition to the existing Note made by Borrower payable to RBS Citizens (the "Existing Note"), Borrower shall execute and deliver to the

3

Administrative Agent an additional Note in favor of Capital One, dated as of the Fourth Amendment Effective Date and substantially in the form of EXHIBIT C to this Amendment ( the "Additional Note"), with the Existing Note and Additional Note each payable by Borrower to the order of each respective Lender for the account of its applicable Lending Office and in a stated principal amount equal to each Lender's respective Commitment (as hereby amended).

b. References to each Note. From and after the Fourth Amendment Effective Date, any and all references in the Loan Documents to the Note or Notes (however defined or described) shall mean and refer to each of the Existing Note and the Additional Note, respectively, as the same may be further endorsed, amended, restated, replaced, supplemented or otherwise modified from time to time.

4. References to Lender. Without limiting the definition of "Lender" or "Lenders" set forth in the Credit Agreement, from and after the Fourth Amendment Effective Date each reference to Lender or Lenders (however defined or described) shall include, without limitation, each of RBS Citizens and Capital One in their respective capacities as Lender under the Credit Agreement and the other Loan Documents.

5. Further Assurances. Loan Parties shall take any and all such actions and execute any and all such instruments and agreements as Administrative Agent shall reasonably request for the purpose of effectuating this Amendment.

6. Limited Amendment; Ratification of Loan Documents. Except as specifically amended hereby, the terms and conditions of the Credit Agreement and the other Loan Documents shall remain in full force and effect, and are hereby ratified and affirmed in all respects by each of the Loan Parties. This Amendment shall not be deemed a waiver of, or consent to, or a modification or amendment of, any other term or condition of the Credit Agreement or any other Loan Document, except as expressly set forth herein.

7. Representations and Warranties.

a. The representations and warranties of Borrower and each other Loan Party, contained in Article VI of the Credit Agreement or any other Loan Document are true and correct in all material respects (except to the extent that any such representation and warranty is qualified as to "materiality," "Material Adverse Effect" or similar language, in which case it shall be true and correct in all respects (after giving effect to any such qualification)) on and as of the Fourth Amendment Effective Date; provided, if any such representations and warranties specifically refer to an earlier date, they shall be true and correct in all material respects (except to the extent that any such representation and warranty is qualified as to "materiality," "Material Adverse Effect" or similar language, in which case it shall be true and correct in all respects (after giving effect to any such qualification)) as of such earlier date.

4

b. Without limiting the generality of the foregoing, in connection with the execution and delivery of this Amendment, Borrower shall provide Administrative Agent with the following:

i. An updated Schedule 4.01, with respect to all Borrowing Base Properties as of the Fourth Amendment Effective Date;

ii. An updated Schedule 6.13, with respect to all Subsidiaries and other Equity Investments and Equity Interests as of the Fourth Amendment Effective Date.

All representations and warranties of Borrower and each other Loan Party, as contained in the Credit Agreement or any other Loan Document shall at all times be applicable with respect to the items set forth in said updated Schedule 4.01 and Schedule 6.13 as of the Fourth Amendment Effective Date (notwithstanding any existing references in the Credit Agreement or other Loan Documents to the prior Schedule 4.01 and Schedule 6.13 as of the Closing Date).

8. Regarding Mortgage and other Collateral. The respective indebtedness, liabilities, and other Obligations of the Loan Parties under the Loan Documents, as modified or otherwise provided herein, are and shall continue to be secured by each of the Mortgages, and any and all other Collateral as set forth under the Loan Documents.

9. Waiver of Claims. Each Loan Party acknowledges and agrees that as of the date hereof, it does not have any claims, counterclaims, offsets, or defenses against any of the Lender Parties directly or indirectly relating to such Loan Party's relationship with, and/or the Obligations under, the Loan Documents, and to the extent that such Loan Party currently has or ever had prior to the date hereof any such claims, counterclaims, offsets, or defenses against any of the Lender Parties, such Loan Party affirmatively WAIVES the same and, on behalf of itself and its representatives, successors and assigns, hereby RELEASES, and forever discharges each Lender Party and its respective officers, directors, agents, servants, attorneys, and employees, and their respective representatives, successors and assigns, of, to, and from all known debts, demands, actions, suits, accounts, covenants, contracts, agreements, damages, and any and all claims, demands, or liabilities whatsoever, of every name and nature, both at law and in equity through the date hereof related to the same.

10. Commitment Fee. In connection with the execution and delivery of this Amendment by the Lender Parties, the Loan Parties hereby acknowledge and agree that the Loan Parties shall have fully earned an additional "Commitment Fee" (so referred to herein) payable by the Borrower in the amount of $122,500, which Commitment Fee shall be in addition to any and all other fees and other amounts paid and/or to be paid by the Borrower and/or any other Loan Party pursuant to this Amendment or the other Loan Documents. The Commitment Fee shall be due and payable in full in connection with the execution and delivery of this Amendment in good and sufficient funds immediately available to the

5

Administrative Agent. Without limiting the generality of the foregoing, the Commitment Fee shall in all events constitute Obligations secured by each Mortgage.

11. Reimbursement of Fees and Expenses. Without limiting the terms and conditions of theCredit Agreement and the other Loan Documents, Borrower hereby agrees to pay to Administrative Agent on demand all of Lender Parties' reasonable legal, and other out-of-pocket fees and expenses incurred by each Lender Party in connection with its due diligence and the negotiation, preparation, and execution of this Agreement and all documents, instruments, and agreements incidental thereto and contemplated herein.

12. Conditions to Effectiveness. The agreements of Lender Parties hereunder shall not be effective until each of the following conditions precedent has been fulfilled to the satisfaction of Administrative Agent:

a. This Amendment and all instruments, documents, and agreements contemplated herein shall have been duly executed and delivered by the respective parties hereto and, shall be in full force and effect and shall be in form and substance reasonably satisfactory to Administrative Agent, including, without limitation, satisfaction of the conditions set forth in Section 4.06 of the Credit Agreement with respect to the additional Mortgages being granted to Administrative Agent, for the benefit of Lenders and L/C Issuer, in connection with the execution and delivery of this Amendment.

All action on the part of the Loan Parties necessary for the valid execution, delivery and performance, respectively, by the Loan Parties pursuant to this Amendment and all instruments, documents, and agreements contemplated herein shall have been duly and effectively taken.

c. Borrower shall have paid the Commitment Fee.

d. Borrower shall have paid all attorneys' reasonable fees and expenses and all title insurance premiums incurred with respect to the additional Mortgages being granted to Administrative Agent in connection with the execution and delivery of this Amendment.

e. Administrative Agent shall have received such other certificates, documents, instruments, opinions, consents, waivers, information, materials and/or agreements as Administrative Agent shall reasonably require in form and substance satisfactory in all respects to Administrative Agent.

13. Governing Law. This Amendment shall be governed by and construed in accordance with the laws of the State of New York.

14. Counterparts. This Amendment may be executed in any number of counterparts, which shall together constitute an entire original agreement, and shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.

6

15. Miscellaneous. This Amendment expresses the entire understanding of the parties with respect to the transactions contemplated hereby. No prior negotiations or discussions shall limit, modify, or otherwise affect the provisions hereof. Any determination that any provision of this Amendment or any application hereof is invalid, illegal or unenforceable in any respect and in any instance shall not affect the validity, legality, or enforceability of such provision in any other instance, or the validity, legality, or enforceability of any other provisions of this Amendment. The Loan Parties represent and warrant that they have consulted with independent legal counsel of their selection in connection herewith and are not relying on any representations or warranties of Lender Parties or their counsel in entering into this Amendment.

[remainder of page left intentionally blank]

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the day and year first above written.

BORROWER:

ARC PROPERTIES OPERATING

PARTNERSHIP, L.P., a Delaware limited partnership

By:  /s/ Jesse Galloway                   

Name: Jesse C. Galloway

Title: Authorized Signatory

PARENT:

AMERICAN REALTY CAPITAL

PROPERTIES, INC., a Maryland corporation

By:  /s/ Jesse Galloway                   

Name: Jesse C. Galloway

Title: Authorized Signatory

Fourth Amendment to ARCP Credit Agreement

RBS CITIZENS, N.A., as Administrative Agent and L/C Issuer

By: /s/ Donald Woods           

Name: Donald Woods

Title: SVP

RBS CITIZENS, N.A., as Lender

By: /s/ Donald Woods           

Name: Donald Woods

Title: SVP

CAPITAL ONE, NATIONAL ASSOCIATION, as Lender

By:                                            

Name:

Title:

Fourth Amendment to ARCP Credit Agreement

RBS CITIZENS, N.A., as Administrative Agent and L/C Issuer

By: ____________________________

Name:

Title:

RBS CITIZENS, N.A., as Lender

By: ____________________________

Name:

Title:

CAPITAL ONE, NATIONAL ASSOCIATION, as Lender

By: /s/ Paul Verdi    

Name: Paul Verdi

Title: Senior Vice President

Fourth Amendment to ARCP Credit Agreement

The undersigned, American Realty Capital Properties, Inc., as Guarantor under that certain Parent Guaranty Agreement dated as of September 7, 2011, hereby consents to the foregoing Fourth Amendment to Credit Agreement and acknowledges and agrees that the Parent Guaranty Agreement executed by the undersigned dated as of September 7, 2011 remains in full force and effect.

AMERICAN REALTY CAPITAL

PROPERTIES, INC., a Maryland corporation

By:  /s/ Jesse Galloway                   

Name: Jesse C. Galloway

Title: Authorized Signatory

Fourth Amendment to ARCP Credit Agreement

Each of the undersigned, as Guarantor under that certain Subsidiary Guaranty Agreement dated as of September 7, 2011, hereby consents to the foregoing Fourth Amendment to Credit Agreement and acknowledges and agrees that the Subsidiary Guaranty Agreement executed by the undersigned dated as of September 7, 2011 remains in full force and effect.

American Realty Capital Partners, LLC

ARC Income Properties III, LLC

CRE JV Mixed Five CT Branch Holdings LLC

CRE JV Mixed Five IL 2 Branch Holdings LLC

CRE JV Mixed Five IL 3 Branch Holdings LLC

CRE JV Mixed Five IL 4 Branch Holdings LLC

CRE JV Mixed Five IL 5 Branch Holdings LLC

CRE JV Mixed Five MI 1 Branch Holdings LLC

CRE JV Mixed Five MI 2 Branch Holdings LLC

CRE JV Mixed Five MI 3 Branch Holdings LLC

CRE JV Mixed Five MI 4 Branch Holdings LLC

CRE JV Mixed Five MI 5 Branch Holdings LLC

CRE JV Mixed Five MI 6 Branch Holdings LLC

CRE JV Mixed Five MI 7 Branch Holdings LLC

CRE JV Mixed Five NH Branch Holdings LLC

CRE JV Mixed Five OH 1 Branch Holdings LLC

CRE JV Mixed Five OH 2 Branch Holdings LLC

CRE JV Mixed Five OH 3 Branch Holdings LLC

CRE JV Mixed Five OH 4 Branch Holdings LLC

CRE JV Mixed Five OH 5 Branch Holdings LLC

CRE JV Mixed Five OH 6 Branch Holdings LLC

CRE JV Mixed Five OH 7 Branch Holdings LLC

CRE JV Mixed Five PA Branch Holdings LLC

CRE JV Mixed Five VT Branch Holdings LLC

ARCP DGBLVAR001, LLC

ARCP DGCRLAR001, LLC

ARCP DGGRFAR001, LLC

ARCP DGJNBIL001, LLC

ARCP AAFNTMI001, LLC

ARCP AAYLNMI001, LLC

ARCP DGLSNM0001, LLC

ARCP DGASGM0001, LLC

ARCP DGBRNM0001, LLC

ARCP DGCTNM0001, LLC

ARCP DGASDM0001, LLC

ARCP DGDMDM0001, LLC

ARCP DGBLFM0001, LLC

ARCP DGAPCM0001, LLC

ARCP DGCMROK001, LLC

ARCP WGMRBSC001, LLC

ARCP WGEPTMI001, LLC

Fourth Amendment to ARCP Credit Agreement

ARCP GSFRENY001, LLC 

ARCP JDDPTIA01, LLC 

ARC FEMTVIL001, LLC 

ARC FEEVLIN001, LLC 

ARC FEMTPPA001, LLC 

ARC FECCTOH001, LLC 

ARC FELDNKY002, LLC 

ARC FEKKEIL001, LLC 

ARCP MBDLSTX01, LLC

ARCP TSRGCTX01, LLC 

ARCP GSPLTNY01, LLC 

ARCP GSWARPA001, LLC 

ARC GSGLOVA001, LLC 

ARC GSMOBAL001, LLC 

ARCP DGSNTM001, LLC 

ARCP DGFPNAR01, LLC 

ARCP DGPCYFL01, LLC 

ARCP DGHVLM001, LLC 

ARCP DGAFTAR01, LLC 

ARCP DGWSGM001, LLC 

ARCP DGWNAM001, LLC 

ARCP DGOGVM001, LLC

ARCP DGGFDM001, LLC 

ARCP DGCCDM001, LLC 

ARCP DGSJSM001, LLC 

ARCP DGSNCM001, LLC 

ARCP DGNWTOK01, LLC 

ARCP DGCNYKS01, LLC 

ARCP DGPMRM0001, LLC 

ARCP DGCVRM001, LLC 

ARC CVAPAGA001, LLC 

ARC CVVDAGA001, LLC 

ARC CVNVLTN001, LLC 

ARC IMCLBOH001, LLC

[Signatures continue next page.]

Fourth Amendment to ARCP Credit Agreement

ARC Income Properties, LLC,

Each a Delaware limited liability company

By:  /s/ Jesse Galloway                   

Name: Jesse C. Galloway

Title: Authorized Signatory

ARC TRS Corp,. a Delaware corporation

By:  /s/ Jesse Galloway                   

Name: Jesse C. Galloway

Title: Authorized Signatory

Fourth Amendment to ARCP Credit Agreement

EXHIBIT A

SCHEDULE 2.01

COMMITMENTS

AND APPLICABLE PERCENTAGES

Lender	Commitment	Applicable
		Percentage
RBS CITIZENS, N.A.	$75,000,000.00	68.18%
CAPITAL ONE, NATIONAL ASSOCIATION	$35,000,000.00	31.82%
Total	$110,000,000.00	100.00%

Fourth Amendment to ARCP Credit Agreement

EXHIBIT B

SCHEDULE 11.02

ADMINISTRATIVE AGENT'S OFFICE;
CERTAIN ADDRESSES FOR NOTICES

PARENT AND BORROWER:

do American Realty Capital

405 Park Avenue, 15^th Floor

New York, New York

Attn: William M. Kahane

with a copy to:

do American Realty Capital

405 Park Avenue, 15^th Floor

New York, New York

Attn: Jesse C. Galloway

ADMINISTRATIVE AGENT:

Administrative Agent's Office

(for payments and Requests for Credit Extensions):

RBS Citizens, N.A.

1215 Superior Avenue

Cleveland, Ohio 44114

Ref: ARC Properties Operating Partnership, L.P. Credit Facility

with a copy to (other than for payments and Requests for Credit Extensions):

Riemer & Braunstein LLP

Three Center Plaza

Boston, Massachusetts 02108

Attn: Kevin J. Lyons, Esq.

L/C ISSUER:

RBS Citizens, N.A.

20 Cabot Road

Mail Stop: MMF470

Fourth Amendment to ARCP Credit Agreement

Medford, Massachusetts 02155

Ref: ARC Properties Operating Partnership, L.P. Credit Facility

LENDERS:

RBS Citizens, N.A.

1215 Superior Avenue

Cleveland, Ohio 44114

Ref: ARC Properties Operating Partnership, L.P. Credit Facility

with a copy to (other than for payments and Requests for Credit Extensions):

Riemer & Braunstein LLP

Three Center Plaza

Boston, Massachusetts 02108

Attn: Kevin J. Lyons, Esq.

Capital One, National Association

90 Park Avenue

New York, NY 10016

Attention: Paul Verdi, SVP

with copies to (other than for payments and Requests for Credit Extensions):

Capital One, National Association

275 Broadhollow Road

Melville, NY 11747

Attention: Jennifer Hussey,VP

and to

Farrell Fritz, P.C.

1320 RXR Plaza

Uniondale, NY 11556

Attention: Christopher P. Daly, Esq.

Fourth Amendment to ARCP Credit Agreement

EX-21

Subsidiaries of American Realty Capital Properties, Inc.

Name	Jurisdiction of Formation./Incorporation
ARC Properties Operating Partnership, L.P.	Delaware
ARCP TRS Corp.	Delaware
ARC Income Properties, LLC	Delaware
ARC Income Properties III, LLC	Delaware
American Realty Capital Partners, LLC	Delaware
CRE JV Mixed Five CT Branch Holdings LLC	Delaware
CRE JV Mixed Five DE Branch Holdings LLC	Delaware
CRE JV Mixed Five IL 2 Branch Holdings LLC	Delaware
CRE JV Mixed Five IL 3 Branch Holdings LLC	Delaware
CRE JV Mixed Five IL 4 Branch Holdings LLC	Delaware
CRE JV Mixed Five IL 5 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 1 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 2 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 3 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 4 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 5 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 6 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 7 Branch Holdings LLC	Delaware
CRE JV Mixed Five NH Branch Holdings LLC	Delaware
CRE JV Mixed Five NY 1 Branch Holdings LLC	Delaware
CRE JV Mixed Five NY 2 Branch Holdings LLC	Delaware
CRE JV Mixed Five NY 3 Branch Holdings LLC	Delaware
CRE JV Mixed Five NY 4 Branch Holdings LLC	Delaware
CRE JV Mixed Five NY 5 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 1 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 2 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 3 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 4 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 5 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 6 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 7 Branch Holdings LLC	Delaware
CRE JV Mixed Five PA Branch Holdings LLC	Delaware
CRE JV Mixed Five VT Branch Holdings LLC	Delaware
CRE JV Mixed Five CT Branch Holdings LLC	Delaware
CRE JV Mixed Five CT Branch Holdings LLC	Delaware
CRE JV Mixed Five DE Branch Holdings LLC	Delaware
CRE JV Mixed Five IL 2 Branch Holdings LLC	Delaware
CRE JV Mixed Five IL 2 Branch Holdings LLC	Delaware
CRE JV Mixed Five IL 3 Branch Holdings LLC	Delaware
CRE JV Mixed Five IL 3 Branch Holdings LLC	Delaware
CRE JV Mixed Five IL 3 Branch Holdings LLC	Delaware
CRE JV Mixed Five IL 4 Branch Holdings LLC	Delaware
CRE JV Mixed Five IL 5 Branch Holdings LLC	Delaware
CRE JV Mixed Five IL 5 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 1 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 1 Branch Holdings LLC	Delaware

CRE JV Mixed Five MI 2 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 2 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 3 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 3 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 4 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 4 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 5 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 5 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 5 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 6 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 6 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 7 Branch Holdings LLC	Delaware
CRE JV Mixed Five MI 7 Branch Holdings LLC	Delaware
CRE JV Mixed Five NH Branch Holdings LLC	Delaware
CRE JV Mixed Five NH Branch Holdings LLC	Delaware
CRE JV Mixed Five NY 1 Branch Holdings LLC	Delaware
CRE JV Mixed Five NY 1 Branch Holdings LLC	Delaware
CRE JV Mixed Five NY 1 Branch Holdings LLC	Delaware
CRE JV Mixed Five NY 2 Branch Holdings LLC	Delaware
CRE JV Mixed Five NY 2 Branch Holdings LLC	Delaware
CRE JV Mixed Five NY 3 Branch Holdings LLC	Delaware
CRE JV Mixed Five NY 3 Branch Holdings LLC	Delaware
CRE JV Mixed Five NY 4 Branch Holdings LLC	Delaware
CRE JV Mixed Five NY 4 Branch Holdings LLC	Delaware
CRE JV Mixed Five NY 4 Branch Holdings LLC	Delaware
CRE JV Mixed Five NY 5 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 1 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 1 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 1 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 2 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 2 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 2 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 3 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 3 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 4 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 5 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 5 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 5 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 6 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 6 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 7 Branch Holdings LLC	Delaware
CRE JV Mixed Five OH 7 Branch Holdings LLC	Delaware
CRE JV Mixed Five PA Branch Holdings LLC	Delaware
CRE JV Mixed Five PA Branch Holdings LLC	Delaware
CRE JV Mixed Five PA Branch Holdings LLC	Delaware
CRE JV Mixed Five PA Branch Holdings LLC	Delaware
CRE JV Mixed Five VT Branch Holdings LLC	Delaware
CRE JV Mixed Five VT Branch Holdings LLC	Delaware
CRE JV Mixed Five VT Branch Holdings LLC	Delaware
ARC HDCOLSC001, LLC	Delaware

ARCP DGBLVAR001, LLC	Delaware
ARCP DGCRLAR001, LLC	Delaware
ARCP DGGRFAR001, LLC	Delaware
ARCP DGJNBIL001, LLC	Delaware
ARCP DGAPCMO001, LLC	Delaware
ARCP DGASGMO001, LLC	Delaware
ARCP DGASDMO001, LLC	Delaware
ARCP DGBRNMO001, LLC	Delaware
ARCP DGBLFMO001, LLC	Delaware
ARCP DGCVLMO001, LLC	Delaware
ARCP DGCTNMO001, LLC	Delaware
ARCP DGDMDMO001, LLC	Delaware
ARCP DGESNMO001, LLC	Delaware
ARCP DGHLVMO001, LLC	Delaware
ARCP DGLSNMO001, LLC	Delaware
ARCP DGLBNMO001, LLC	Delaware
ARCP DGPMRMO001, LLC	Delaware
ARCP DGQLNMO001, LLC	Delaware
ARCP DGSTLMO001, LLC	Delaware
ARCP DGSFDMO001, LLC	Delaware
ARCP DGCMROK001, LLC	Delaware
ARCP AACROMI001, LLC	Delaware
ARCP AACLTMI001, LLC	Delaware
ARCP AAFNTMI001, LLC	Delaware
ARCP AALVNMI001, LLC	Delaware
ARCP AASSMMI001, LLC	Delaware
ARCP AAYLNMI001, LLC	Delaware
ARCP WGMRBSC001, LLC	Delaware
ARCP GSFRENY001, LLC	Delaware
ARCP WGEPTMI001, LLC	Delaware
ARCP JDDPTIA01, LLC	Delaware
ARC FECCTOH001, LLC	Delaware
ARC FEEVLIN001, LLC	Delaware
ARC FEKKEIL001, LLC	Delaware
ARC FELNDKY002, LLC	Delaware
ARC  FEMTVIL001, LLC	Delaware
ARC FEMTPPA001, LLC	Delaware
ARCP GSPLTNY01, LLC	Delaware
ARC GSMOBAL001, LLC	Delaware
ARCP TSRGCTX01, LLC	Delaware
ARCP GSWARPA01, LLC	Delaware
ARCP DGAFTAR01, LLC	Delaware
ARCP DGFPNAR01, LLC	Delaware
ARCP DGPCYFL01., LLC	Delaware
ARCP DGCNYKS01, LLC	Delaware
ARCP DGCVRMO01, LLC	Delaware
ARCP DGCCDMO01, LLC	Delaware
ARCP DGGFDMO01, LLC	Delaware
ARCP DGHVLMO01, LLC	Delaware
ARCP DGOGVMO01, LLC	Delaware

ARCP DGPMRMO01, LLC	Delaware
ARCP DGSNTMO01, LLC	Delaware
ARCP DGSNCMO01, LLC	Delaware
ARCP DGSJSMO01, LLC	Delaware
ARCP DGWSGMO01, LLC	Delaware
ARCP DGWNAMO01, LLC	Delaware
ARCP DGNWTOK01, LLC	Delaware
ARC GSGLOVA001, LLC	Delaware
ARCP MBDLSTX01, LLC	Delaware
ARC RBCSRNJ001, LLC	Delaware
ARC CVAPAGA001, LLC	Delaware
ARC CVVDAGA001, LLC	Delaware
ARC CVNVLTN001, LLC	Delaware
ARC IMCLBOH001, LLC	Delaware
ARC FDBKNIN001, LLC	Delaware
ARC AAATNTX001, LLC	Delaware

EX-31.1

CERTIFICATION PURSUANT TO RULE 13a-14(a) AND 15d-14(a) UNDER

THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED

I, Nicholas S. Schorsch, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of American Realty Capital Properties, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated this	29th day of October, 2012	/s/ Nicholas S. Schorsch
		Nicholas S. Schorsch
		Chief Executive Officer and
		Chairman of the Board of Directors (Principal Executive Officer)

EX-31.2

CERTIFICATION PURSUANT TO RULE 13a-14(a) AND 15d-14(a) UNDER

THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED

I, Brian S. Block, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of American Realty Capital Properties Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated this	29th day of October, 2012	/s/ Brian S. Block
		Brian S. Block Executive Vice President and Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)

EX-32

SECTION 1350 CERTIFICATIONS

This Certificate is being delivered pursuant to the requirements of Section 1350 of Chapter 63 (Mail Fraud) of Title 18 (Crimes and Criminal Procedures) of the United States Code, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed for purposes of Section 18 of the Securities Act of 1934, as amended.

The undersigned, who are the Chief Executive Officer and Chief Financial Officer of American Realty Capital Properties, Inc. (the “Company”), each hereby certify as follows:

The quarterly report on Form 10-Q of the Company, which accompanies this Certificate, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and all information contained in this quarterly report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated this	29th day of October, 2012
		/s/ Nicholas S. Schorsch
		Nicholas S. Schorsch
		Chief Executive Officer and Chairman of the Board of Directors
		(Principal Executive Officer)
		/s/ Brian S. Block
		Brian S. Block
		Executive Vice President and Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)

XML

Mortgage Note Payable (Schedule of Mortgage Notes Payable) (Details) (USD $) In Thousands, unless otherwise specified	9 Months Ended		12 Months Ended
	Sep. 30, 2012		Dec. 31, 2011
Debt Instrument [Line Items]
Outstanding Loan Amount	$ 35,760		$ 30,260
Mortgages [Member]
Debt Instrument [Line Items]
Encumbered Properties, in properties	29		28
Outstanding Loan Amount	$ 35,760		$ 30,260
Weighted Average Effective Interest Rate	4.52%	[1]	4.67%	[1]
Weighted Average Maturity Term	3 years 9 months 7 days	[2]	4 years 3 months 26 days	[2]
Minimum [Member] | Mortgages [Member]
Debt Instrument [Line Items]
Effective Interest Rate	3.68%		3.80%
Maximum [Member] | Mortgages [Member]
Debt Instrument [Line Items]
Effective Interest Rate	5.32%		5.32%

[1] (1)Mortgage notes payable have fixed rates. Effective interest rates range from 3.68% to 5.32% at September 30, 2012 and 3.80% to 5.32% at December 31, 2011.

[2] Weighted average remaining years until maturity as of September 30, 2012 and December 31, 2011, respectively.

XML

Net Loss Per Share (Schedule of Earnings Per Share, Basic and Diluted)(Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		9 Months Ended			1 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012 Restricted Stock [Member]	May 31, 2012 Series A Preferred Stock [Member]
Earnings Per Share, Basic and Diluted, by Common Class, Including Two Class Method [Line Items]
Net loss from continuing operations attributable to stockholders	$ (763)	$ (625)	$ (3,034)	$ (641)
Less: dividends declared on Preferred shares	(140)	0	210
Net loss from continuing operations attributable to common stockholders	(903)	(625)	(3,244)	(641)
Loss from discontinued operations attributable to stockholders	(41)	(9)	(440)	(9)
Net loss attributable to common stockholders, net of distributions	$ (944)	$ (634)	$ (3,684)	$ (650)
Weighted average common shares outstanding	10,846,432	1,515,710	8,543,365	511,452
Basic and diluted net loss per share from continuing operations attributable to common stockholders	$ (0.08)		$ (0.38)	$ (1.25)
Basic and diluted net loss per share from discontinued operations attributable to stockholders	$ 0.00		$ (0.05)	$ (0.02)
Basic and diluted net loss per share attributable to common stockholders	$ (0.09)	$ (0.42)	$ (0.43)	$ (1.27)
Antidilutive securtities excluded from computation of earnings per share			886,376		217,727
Shares Issued (in shares)						545,454

XML

Related Party Transactions and Arrangements (Details) (USD $) In Millions, except Share data, unless otherwise specified		9 Months Ended	1 Months Ended
	Sep. 30, 2012	Sep. 30, 2012 Gross Proceeds, Initial Public Offering [Member] Realty Capital Securities, LLC [Member] Dealer Manager [Member]	Sep. 30, 2012 Gross Proceeds, Common Stock [Member] Realty Capital Securities, LLC [Member] Dealer Manager [Member]	Sep. 30, 2012 Contract Purchase Price [Member] ARC Properties Advisors, LLC [Member] Manager [Member]	Sep. 30, 2012 Amount Available or Outstanding Under Financing Arrangement [Member] ARC Properties Advisors, LLC [Member] Manager [Member]	Sep. 30, 2012 Average Invested Assets [Member] ARC Properties Advisors, LLC [Member] Manager [Member]	Sep. 30, 2012 Operating Partnership Unit [Member] ARC Real Estate Partners, LLC [Member]	Dec. 31, 2011 Operating Partnership Unit [Member] ARC Real Estate Partners, LLC [Member]	Sep. 30, 2012 Operating Partnership Unit [Member] ARC Real Estate Partners, LLC [Member] Contributor [Member]
Related Party Transaction [Line Items]
Due from Affiliates	$ 0.2
Common stock held by related party, percent							19.40%	31.30%
Operating Partnership Units Held By Related Party									310,000
Sales commissions as a percentage of benchmark		6.00%	2.00%
Acquisition fees as a percentage of benchmark				1.00%
Financing coordination as a percentage of benchmark					0.75%
Asset management fees as a percentage of benchmark						0.50%

XML

Discontinued Operations and Properties Held for Sale (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011	Dec. 31, 2011
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Assets held for sale, net	$ 812		$ 812		$ 1,818
Operating Loss for Properties Held for Sale	$ 41	$ 9	$ 440	$ 9
Vacant [Member] | Real Estate [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of Real Estate Properties	1		1		2

XML

Convertible Preferred Stock (Details) (USD $)	1 Months Ended			0 Months Ended
	May 31, 2012 Series A Preferred Stock [Member]	Sep. 30, 2012 Series A Preferred Stock [Member]	Dec. 31, 2011 Series A Preferred Stock [Member]	Jul. 24, 2012 Series B Preferred Stock [Member]
Class of Stock [Line Items]
Shares Issued (in shares)	545,454			283,018
Proceeds from Issuance of stock	$ 6,000,000			$ 3,000,000
Proceeds from Issuance of stock, net	$ 5,800,000			$ 3,000,000
Liquidation Preference Per Share	$ 11	$ 11.00	$ 11.00	$ 10.60
Convertible Preferred Stock, Terms of Conversion	one year			one year
Redemption Premium Percent	1.00%			1.00%
Annualized rate of dividend (per share)	$ 0.77			$ 0.74
Redemption price per share	$ 11			$ 10.60

XML

Real Estate Investments (Assets And Liabilities Assumed) (Details) (USD $)	9 Months Ended			0 Months Ended					9 Months Ended
	Sep. 30, 2012 property	Sep. 30, 2011	Sep. 30, 2012 In-Place Leases [Member]	Jul. 03, 2012 Property in Havertown, PA [Member]	Sep. 30, 2012 Contributor [Member] ARC Real Estate Partners, LLC [Member] property	Sep. 30, 2012 Occupied [Member] property	Sep. 30, 2012 Vacant [Member] Real Estate [Member] property	Dec. 31, 2011 Vacant [Member] Real Estate [Member] property	Sep. 30, 2012 Building [Member]	Sep. 30, 2012 Furniture and Fixtures [Member]	Sep. 30, 2012 Building Improvements [Member]
Real Estate Properties [Line Items]
Land	$ 10,228,000
Buildings, fixtures and improvements	75,360,000
Total tangible assets	85,588,000
Acquired intangibles			13,262,000
Purchase proce of acquired real estate investments	98,850,000
OP units issued to acquire real estate investments	(6,352,000)	0
Cash paid for acquired real estate investments	92,498,000	0
Number of real estate property purchased, in properties	36
Number of properties contributed by affiliate, in properties					63
Number of Real Estate Properties						125	1	2
Business Acquisition, Pending Purchase Price Allocation	8,000,000								5,100,000	1,100,000	1,800,000
Proceeds from sale of property held for sale	$ 553,000	$ 0		$ 600,000

XML

Mortgage Note Payable (Tables)

9 Months Ended

Sep. 30, 2012

Notes Payable [Abstract]

Schedule of Mortgage Notes Payable

The Company’s mortgage notes payable consist of the following as of September 30, 2012 and December 31, 2011 (dollar amounts in thousands):

	Encumbered Properties	Outstanding Loan Amount		Weighted Average Effective Interest Rate(1)		Weighted Average Maturity(2)
September 30, 2012	29	$	35,760	4.52	%	3.77
December 31, 2011	28	$	30,260	4.67	%	4.32

_______________________________________________

(1) Mortgage notes payable have fixed rates. Effective interest rates range from 3.68% to 5.32% at September 30, 2012 and 3.80% to 5.32% at December 31, 2011.

(2) Weighted average remaining years until maturity as of September 30, 2012 and December 31, 2011, respectively.

Schedule Of Aggregate Principal Payments Of Mortgages

The following table summarizes the scheduled aggregate principal repayments subsequent to September 30, 2012 (amounts in thousands):

	Total
October 1, 2012 - December 31, 2012	$	—
2013	74
2014	189
2015	13,767
2016	11,760
Thereafter	9,970
Total	$	35,760

XML

Related Party Transactions and Arrangements (Schedule of Offering Costs Reimbursements to Related Parties) (Details) (Manager [Member], ARC Properties Advisors, LLC [Member], Fees and Expense Reimbursement, Stock Offering [Member], USD $)	3 Months Ended	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2012	Sep. 30, 2011
Manager [Member] | ARC Properties Advisors, LLC [Member] | Fees and Expense Reimbursement, Stock Offering [Member]
Schedule of Offering Costs Reimbursements to Related Parties [Line Items]
Related Party Transaction, Expenses from Transactions with Related Party	$ 59,000	$ 109,000	$ 0

XML

Derivatives and Hedging Activities (Details) (Cash Flow Hedging [Member], Interest Rate Cap [Member], Designated as Hedging Instrument [Member], Interest Expense [Member], USD $)	9 Months Ended
	Sep. 30, 2012
Cash Flow Hedging [Member] | Interest Rate Cap [Member] | Designated as Hedging Instrument [Member] | Interest Expense [Member]
Derivatives, Fair Value [Line Items]
Reclassification period from other comprehensive income as an increase to interest expense	12 months
Reclassified from other comprehensive income as an increase to interest expense	$ 13,000

XML

Real Estate Investments (Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas) (Details)	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
Michigan [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Annualized Rental Income, Percentage	14.20%	22.70%
South Carolina [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Annualized Rental Income, Percentage	12.40%	25.00%
IOWA
Revenues from External Customers and Long-Lived Assets [Line Items]
Annualized Rental Income, Percentage	11.70%
New York [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Annualized Rental Income, Percentage	10.40%	11.70%
Ohio [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Annualized Rental Income, Percentage	11.80%	20.00%

XML

Related Party Transactions and Arrangements (Schedule of General and Administrative Expenses Absorbed) (Details) (Absorbed General and Administrative Expenses [Member], Manager [Member], ARC Properties Advisors, LLC [Member], USD $) In Thousands, unless otherwise specified	3 Months Ended	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2012
Absorbed General and Administrative Expenses [Member] | Manager [Member] | ARC Properties Advisors, LLC [Member]
Schedule of General and Administrative Expenses Absorbed [Line Items]
Related Party Transaction, Amounts of Transaction	$ 0	$ 164

XML

Common Stock (Details) (USD $) In Millions, except Share data, unless otherwise specified	0 Months Ended										12 Months Ended	22 Months Ended
	Nov. 16, 2012	Sep. 30, 2012	Sep. 16, 2012	Jun. 30, 2012	Jun. 08, 2012	Mar. 17, 2012	Mar. 15, 2012	Feb. 27, 2012	Sep. 07, 2011	Dec. 31, 2011	Dec. 31, 2011 Common Stock [Member]	Sep. 30, 2012 Common Stock [Member]	Jul. 02, 2012 Common Stock [Member]	Jun. 18, 2012 Common Stock [Member]	Nov. 07, 2011 Common Stock [Member]	Nov. 02, 2011 Common Stock [Member]	Sep. 06, 2011 Common Stock [Member]
Class of Stock [Line Items]
Common stock, shares issued		11,163,617								7,323,434			487,500	3,250,000	100,000	1,500,000	5,600,000
Common stock, shares outstanding		11,163,617								7,323,434		11,200,000
Proceeds from Issuance of Common Stock											$ 78.1	$ 118.9
Dividends declared, in dollars per share		$ 0.895		$ 0.890		$ 0.885		$ 0.880	$ 0.875
Dividends paid per share	$ 0.07458		$ 0.07417		$ 0.07375		$ 0.0733

XML

Real Estate Investments

9 Months Ended

Sep. 30, 2012

Real Estate [Abstract]

Real Estate Investments

Real Estate Investments

The following table presents the allocation of real estate investment assets acquired by the Company during the ninemonths ended September 30, 2012 (dollar amounts in thousands):

Real estate investments, at cost:
Land	$	10,228
Buildings, fixtures and improvements	75,360
Total tangible assets	85,588
Acquired intangibles:
In-place leases	13,262
Total assets acquired, net	98,850
OP Units issued to acquire real estate investments	(6,352		)
Cash paid to acquire real estate investments	$	92,498
Number of properties acquired	36

The Company owns and operates commercial properties. As of September 30, 2012, the Company owned 125 properties, one of which is vacant and classified as held for sale.  Buildings, fixtures and improvements include $8.0 million, comprised of $5.1 million, $1.1 million and $1.8 million, provisionally assigned to buildings, fixtures and improvements, respectively, pending receipt of the final cost segregation analysis on such assets being prepared by a third party specialist. The Contributor, an affiliate of the Sponsor, contributed 63 properties (the "Contributed Properties") in September 2011 in conjunction with the completion of the IPO at amortized cost.

On July 3, 2012, the Company sold a vacant property in Havertown, PA, which was classified as held for sale for net proceeds of $0.6 million.

The Company’s portfolio of real estate investment properties (excluding one vacant property), which were all 100% leased, is comprised of the following 124 properties as of September 30, 2012:

Portfolio	Contribution or Acquisition Date	Number of Properties	Square Feet	Remaining Lease Term (1)	Base Purchase Price (2)		Capitalization Rate (3)	Annualized Rental Income/ NOI (4)		Annualized Rental Income/NOI per Square Foot
					(in thousands)			(in thousands)
Home Depot	Sep, 2011	1	465,600	17.2	$	23,398	9.7%	$	2,258	$	4.85
Citizens Bank	Sep, 2011	59	291,920	5.4	95,241		7.1%	6,726		23.04
Community Bank	Sep, 2011	1	4,410	3.8	705		5.1%	36		8.16
Dollar General I	Nov, 2011	20	177,668	6.9	9,981		9.7%	965		5.43
Advance Auto	Nov. & Dec. 2011	6	42,000	7.1	5,122		8.9%	457		10.88
Walgreens I	Dec, 2011	1	14,414	9.0	2,426		10.1%	245		17.00
Portfolio - December 31, 2011		88	996,012	8.2	136,873		7.8%	10,687		10.73
GSA I (5)	Jan, 2012	1	12,009	6.4	4,850		8.2%	396		32.98
Walgreens II	Jan, 2012	1	15,120	6.3	3,778		9.2%	346		22.88
FedEx	May, 2012	6	92,935	4.2	12,207		9.0%	1,099		11.83
John Deere	May, 2012	1	552,960	5.3	26,126		9.0%	2,353		4.26
GSA II (5)	Jun, 2012	1	18,640	6.0	5,835		11.1%	647		34.71
GSA III (5)	Jun, 2012	1	39,468	4.6	6,350		9.5%	604		15.30
Tractor Supply	Jun, 2012	1	38,507	6.1	1,921		9.5%	183		4.75
GSA IV (5)	Jun, 2012	1	22,509	6.0	3,890		11.0%	428		19.01
Dollar General II	Jun, 2012	16	134,102	5.1	5,993		10.7%	642		4.79
GSA V (5)	Jun, 2012	1	11,281	4.4	2,200		9.9%	217		19.24
Mrs Baird's	Jul, 2012	1	75,050	4.7	6,213		10.2%	631		8.40
Reckitt Benckiser	Aug, 2012	1	32,000	5.6	10,000		9.6%	964		30.13
CVS	Sep, 2012	3	31,620	4.7	4,855		9.9%	481		15.21
Iron Mountain	Sep, 2012	1	126,664	5.3	4,632		9.6%	443		3.50
2012 Acquisitions		36	1,202,865	5.2	98,850		9.5%	9,434		7.84
Portfolio - September 30, 2012(6)		124	2,198,877	6.8	$	235,723	8.5%	$	20,121	$	9.15

_______________________________________________

(1) Remaining lease term as of September 30, 2012, in years. If the portfolio has multiple locations with varying lease expirations, remaining lease term is calculated on a weighted-average basis. Total remaining lease term is a weighted average of the remaining lease term of the total portfolio.

(2) Original purchase price of the Contributed Properties and base purchase price of all other properties, in each case excluding acquisition and transaction-related costs. Acquisition and transaction-related costs include legal and various other closing costs incurred in connection with acquiring investment properties.

(3) Annualized rental income or annualized net operating income ("NOI"), on a straight-line basis, divided by base purchase price.

(4) Annualized rental income/NOI for net leases is rental income on a straight-line basis as of September 30, 2012, which includes the effect of tenant concessions such as free rent, as applicable. For modified gross leased properties, NOI is rental income on a straight-line basis as of September 30, 2012, which includes the effect of tenant concessions such as free rent, as applicable, plus operating expense reimbursement revenue less property operating expenses.

(5) Lease on property is a modified gross lease. As such, annualized rental income/NOI for this property is rental income on a straight-line basis as of September 30, 2012, which includes the effect of tenant concessions such as free rent plus operating expense reimbursement revenue less property operating expenses.

(6) Total portfolio excludes one vacant property contributed in September 2011, which is classified as held for sale as of September 30, 2012.

Future Lease Payments

The following table presents future minimum base rental cash payments due to the Company over the next five years and thereafter.  These amounts exclude contingent rent payments, as applicable, that may be collected from certain tenants based on provisions related to sales thresholds and increases in annual rent based on exceeding certain economic indexes among other items (amounts in thousands):

	Future Minimum Base Rent Payments
October 1, 2012 - December 31, 2012	$	4,980
2013	20,228
2014	20,416
2015	20,246
2016	19,858
Thereafter	72,222
	$	157,950

Tenant Concentration

The following table lists the tenants whose annualized rental income/NOI on a straight-line basis represented greater than 10% of consolidated annualized rental income/NOI on a straight-line basis as of September 30, 2012 and 2011:

Tenant	September 30, 2012	September 30, 2011
Citizens Bank	33.4%	75.0%
John Deere	11.7%	—%
GSA	11.4%	—%
Home Depot	11.2%	25.0%

The termination, delinquency or non-renewal of one or more leases by either of the above tenants may have a material effect on revenues. No other tenant represents more than 10% of the annualized rental income/NOI for the period presented.

Geographic Concentration

The following table lists the states where the Company has concentrations of properties where annual rental income/NOI on a straight-line basis represented greater than 10% of consolidated annualized rental income/NOI on a straight-line basis as of September 30, 2012 and 2011:

State	September 30, 2012		September 30, 2011
Michigan	14.2	%	22.7	%
South Carolina	12.4	%	25.0	%
Ohio	11.8	%	20.0	%
Iowa	11.7	%	*
New York	10.4	%	11.7	%

_______________________________________________

* The state's annualized rental income/NOI was not greater than 10% of total annualized rental income for all portfolio properties as of the period specified.

XML

Derivatives and Hedging Activities (Schedule of Interest Rate Derivatives) (Details) (Cash Flow Hedging [Member], Designated as Hedging Instrument [Member], Interest Rate Cap [Member], USD $) In Thousands, unless otherwise specified	Sep. 30, 2012 derivative
Cash Flow Hedging [Member] | Designated as Hedging Instrument [Member] | Interest Rate Cap [Member]
Derivative [Line Items]
Number of Instruments	1
Notional Amount	$ 50,000

XML

Share-Based Compensation (Schedule of Share-Based Compensation, Activity) (Tables)

9 Months Ended

Sep. 30, 2012

Share-based Compensation [Abstract]

Schedule of Share-based Compensation, Activity [Table Text Block]

The following table details the restricted shares activity within the Equity Plan and Director Stock Plan during the nine months ended September 30, 2012:

	Equity Plan				Director Stock Plan
	Number of Common Shares		Weighted-Average Issue Price		Number of Common Shares		Weighted-Average Issue Price
Unvested, December 31, 2011	167,400		$	12.50	9,000		$	12.50
Granted	93,683		10.65		9,000		10.65
Vested	(59,556	)	12.41		(1,800	)	12.50
Unvested, September 30, 2012	201,527		$	12.50	16,200		$	11.47

XML

Related Party Transactions and Arrangements (Tables)

9 Months Ended

Sep. 30, 2012

Related Party Transactions [Abstract]

Schedule of Selling Commissions and Dealer Manager Fees Payable to Affiliate [Table Text Block]

The following table details the results of such activities related to RCS (in thousands):

	Three Months Ended				Nine Months Ended
	September 30, 2012		September 30, 2011		September 30, 2012		September 30, 2011
Total commissions paid to affiliated Dealer Manager	$	—	$	919	$	—	$	919

Schedule Of Offering Costs Reimbursements to Related Party [Table Text Block]

The following table details the results of such activities related to organizational and offering costs reimbursed to the Manager (amounts in thousands):

	Three Months Ended				Nine Months Ended
	September 30, 2012		September 30, 2011		September 30, 2012		September 30, 2011
Offering expense reimbursements	$	59	$	—	$	109	$	—

Schedule of Amount Contractually Due and Forgiven in Connection With Operation Related Services

The following table details amounts incurred by the Company and contractually due to the Sponsor and the Manager and forgiven in connection with the operations related services described above (amounts in thousands):

	Three Months Ended				Three Months Ended
	September 30, 2012				September 30, 2011
	Incurred		Forgiven		Incurred		Forgiven
One-time fees:
Acquisition fees and related cost reimbursements	$	441	$	—	$	—	$	—
Financing fees and related cost reimbursements	369		—		—		—
Other expense reimbursements	45		—		—		—
On-going fees:
Base management fees	—		278		—		50
Incentive fees	—		—		—		—
Total operational fees and reimbursements	$	855	$	278	$	—	$	50

	Nine Months Ended				Nine Months Ended
	September 30, 2012				September 30, 2011
	Incurred		Forgiven		Incurred		Forgiven
One-time fees:
Acquisition fees and related cost reimbursements	$	1,703	$	—	$	—	$	—
Financing fees and related cost reimbursements	583		—		—		—
Other expense reimbursements	71		—		—		—
On-going fees:
Base management fees	—		664		—		50
Incentive fees	—		—		—		—
Total operational fees and reimbursements	$	2,357	$	664	$	—	$	50

Schedule of General and Administrative Expenses Absorbed by Affiliate [Table Text Block]

The following table details general and administrative expenses absorbed by the Sponsor during the three and nine months ended September 30, 2012 (amounts in thousands).

	Three months ended		Nine months ended
	September 30, 2012		September 30, 2012
General and administrative expenses absorbed	$	—	$	164

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Subsequent Events (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2012 2012 Acquisitons [Member] property sqft	Oct. 26, 2012 October Acquisitions [Member] property sqft		Oct. 26, 2012 Subsequent Event [Member] property sqft	Sep. 30, 2012 Vacant [Member] Real Estate [Member] property sqft	Dec. 31, 2011 Vacant [Member] Real Estate [Member] property
Subsequent Event [Line Items]
Number of Real Estate Properties	124	2		126	1	2
Square feet of acquired property	2,198,877	14,985		2,213,862	3,200
Purchase price of acquired property	$ 235,723	$ 2,258	[1]	$ 237,981	$ 1,200

[1] Original purchase price of the Contributed Properties and base purchase price of all other properties, in each case excluding acquisition and transaction-related costs. Acquisition and transaction-related costs include legal and various other closing costs incurred in connection with acquiring investment properties.

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Derivatives and Hedging Activities (Schedule of Derivative Instruments in Statement of Financial Position, Fair Value) (Details) (Interest Rate Cap [Member], Cash Flow Hedging [Member], Designated as Hedging Instrument [Member], Derivative Financial Instruments, Liabilities [Member], USD $) In Thousands, unless otherwise specified	Sep. 30, 2012	Dec. 31, 2011
Interest Rate Cap [Member] | Cash Flow Hedging [Member] | Designated as Hedging Instrument [Member] | Derivative Financial Instruments, Liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative, at fair value	$ 0	$ 0

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Net Loss Per Share (Tables)

9 Months Ended

Sep. 30, 2012

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted

The following is a summary of the basic and diluted net loss per share computation for the three and nine months ended September 30, 2012 and 2011 (dollars in thousands, expect for shares and per share data):  

	Three Months Ended September 30,						Nine Months Ended September 30,
	2012			2011			2012			2011
Net loss from continuing operations attributable to stockholders	$	(763	)	$	(625	)	$	(3,034	)	$	(641	)
Less: dividends declared on preferred shares	(140		)	—			(210		)
Net loss from continuing operations attributable to common stockholders	(903		)	(625		)	(3,244		)	(641		)
Net loss from discontinued operations attributable to stockholders	(41		)	(9		)	(440		)	(9		)
Net loss attributable to common stockholders, net of dividends on preferred shares	$	(944	)	$	(634	)	$	(3,684	)	$	(650	)
Weighted average common shares outstanding	10,846,432			1,515,710			8,543,365			511,452
Basic and diluted net loss per share from continuing operations attributable to common stockholders	$	(0.08	)	$	(0.41	)	$	(0.38	)	$	(1.25	)
Basic and diluted net loss per share from discontinued operations attributable to stockholders	$	—		$	(0.01	)	$	(0.05	)	$	(0.02	)
Basic and diluted net loss per share attributable to common stockholders	$	(0.09	)	$	(0.42	)	$	(0.43	)	$	(1.27	)

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Subsequent Events (Schedule of Acquisition Subequent to Period End) (Tables)

9 Months Ended

Sep. 30, 2012

Subsequent Events [Abstract]

Schedule of Real Estate Properties

The Company’s portfolio of real estate investment properties (excluding one vacant property), which were all 100% leased, is comprised of the following 124 properties as of September 30, 2012:

Portfolio	Contribution or Acquisition Date	Number of Properties	Square Feet	Remaining Lease Term (1)	Base Purchase Price (2)		Capitalization Rate (3)	Annualized Rental Income/ NOI (4)		Annualized Rental Income/NOI per Square Foot
					(in thousands)			(in thousands)
Home Depot	Sep, 2011	1	465,600	17.2	$	23,398	9.7%	$	2,258	$	4.85
Citizens Bank	Sep, 2011	59	291,920	5.4	95,241		7.1%	6,726		23.04
Community Bank	Sep, 2011	1	4,410	3.8	705		5.1%	36		8.16
Dollar General I	Nov, 2011	20	177,668	6.9	9,981		9.7%	965		5.43
Advance Auto	Nov. & Dec. 2011	6	42,000	7.1	5,122		8.9%	457		10.88
Walgreens I	Dec, 2011	1	14,414	9.0	2,426		10.1%	245		17.00
Portfolio - December 31, 2011		88	996,012	8.2	136,873		7.8%	10,687		10.73
GSA I (5)	Jan, 2012	1	12,009	6.4	4,850		8.2%	396		32.98
Walgreens II	Jan, 2012	1	15,120	6.3	3,778		9.2%	346		22.88
FedEx	May, 2012	6	92,935	4.2	12,207		9.0%	1,099		11.83
John Deere	May, 2012	1	552,960	5.3	26,126		9.0%	2,353		4.26
GSA II (5)	Jun, 2012	1	18,640	6.0	5,835		11.1%	647		34.71
GSA III (5)	Jun, 2012	1	39,468	4.6	6,350		9.5%	604		15.30
Tractor Supply	Jun, 2012	1	38,507	6.1	1,921		9.5%	183		4.75
GSA IV (5)	Jun, 2012	1	22,509	6.0	3,890		11.0%	428		19.01
Dollar General II	Jun, 2012	16	134,102	5.1	5,993		10.7%	642		4.79
GSA V (5)	Jun, 2012	1	11,281	4.4	2,200		9.9%	217		19.24
Mrs Baird's	Jul, 2012	1	75,050	4.7	6,213		10.2%	631		8.40
Reckitt Benckiser	Aug, 2012	1	32,000	5.6	10,000		9.6%	964		30.13
CVS	Sep, 2012	3	31,620	4.7	4,855		9.9%	481		15.21
Iron Mountain	Sep, 2012	1	126,664	5.3	4,632		9.6%	443		3.50
2012 Acquisitions		36	1,202,865	5.2	98,850		9.5%	9,434		7.84
Portfolio - September 30, 2012(6)		124	2,198,877	6.8	$	235,723	8.5%	$	20,121	$	9.15

_______________________________________________

(1) Remaining lease term as of September 30, 2012, in years. If the portfolio has multiple locations with varying lease expirations, remaining lease term is calculated on a weighted-average basis. Total remaining lease term is a weighted average of the remaining lease term of the total portfolio.

(2) Original purchase price of the Contributed Properties and base purchase price of all other properties, in each case excluding acquisition and transaction-related costs. Acquisition and transaction-related costs include legal and various other closing costs incurred in connection with acquiring investment properties.

(3) Annualized rental income or annualized net operating income ("NOI"), on a straight-line basis, divided by base purchase price.

(4) Annualized rental income/NOI for net leases is rental income on a straight-line basis as of September 30, 2012, which includes the effect of tenant concessions such as free rent, as applicable. For modified gross leased properties, NOI is rental income on a straight-line basis as of September 30, 2012, which includes the effect of tenant concessions such as free rent, as applicable, plus operating expense reimbursement revenue less property operating expenses.

(5) Lease on property is a modified gross lease. As such, annualized rental income/NOI for this property is rental income on a straight-line basis as of September 30, 2012, which includes the effect of tenant concessions such as free rent plus operating expense reimbursement revenue less property operating expenses.

(6) Total portfolio excludes one vacant property contributed in September 2011, which is classified as held for sale as of September 30, 2012.

The following table presents certain information about the properties that the Company acquired from October 1, 2012 to October 26, 2012 (dollar amounts in thousands):

	No. of Buildings	Square Feet	Base Purchase Price (1)
Total Portfolio – September 30, 2012 (2)	124	2,198,877	$	235,723
Acquisitions	2	14,985	2,258
Total portfolio – October 26, 2012 (2)	126	2,213,862	$	237,981

____________________________

(1) Contract purchase price, excluding acquisition and transaction related costs.

(2) Total portfolio excludes one vacant property contributed in September 2011 which was classified as held for sale at September 30, 2012. The aggregate square footage and original base purchase price of this contributed vacant property was 3,200 and $1.2 million, respectively.

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Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2012

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

The consolidated financial statements of the Company included herein were prepared in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The information furnished includes all adjustments and accruals of a normal recurring nature, which, in the opinion of management, are necessary for a fair presentation of results for the interim periods. The results of operations for the three and nine months ended September 30, 2012 are not necessarily indicative of the results for the entire year or any subsequent interim period.

These financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto as of and for the year ended December 31, 2011, which are included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC") on March 19, 2012. There have been no significant changes to these policies during the nine months ended September 30, 2012, other than the updates described below.

Recent Accounting Pronouncements

In May 2011, the Financial Accounting Standards Board (the "FASB") issued guidance that expands the existing disclosure requirements for fair value measurements, primarily for Level 3 measurements, which are measurements based on unobservable inputs such as the Company’s own data. This guidance is largely consistent with current fair value measurement principles with few exceptions that do not result in a change in general practice. The guidance was applied prospectively and was effective for interim and annual reporting periods ending after December 15, 2011. The adoption of this guidance did not have a material impact on the Company’s financial position or results of operations as the guidance relates only to disclosure requirements.

In June 2011, the FASB issued guidance requiring entities to present items of net income and other comprehensive income either in one continuous statement – referred to as the statement of comprehensive income – or in two separate, but consecutive, statements of net income and other comprehensive income. The new guidance does not change which components of comprehensive income are recognized in net income or other comprehensive income, or when an item of other comprehensive income must be reclassified to net income. In December 2011, the FASB deferred certain provisions of this guidance related to the presentation of certain reclassification adjustments out of accumulated other comprehensive income, by component in both the statement and the statement where the reclassification is presented. This guidance was applied prospectively and was effective for interim and annual reporting periods ended after December 15, 2011. The adoption of this guidance did not have a material impact on the Company’s financial position or results of operations but changed the location of the presentation of other comprehensive income to more closely associate the disclosure with net income.

In September 2011, the FASB issued guidance that allows entities to perform a qualitative analysis as the first step in determining whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If it is determined that it is not more likely than not that the fair value of the reporting unit is less than its carrying amount, then a quantitative analysis for impairment is not required. The guidance was effective for interim and annual impairment tests for fiscal periods beginning after December 15, 2011.  The adoption of this guidance did not have a material impact on the Company's financial position or results of operations.

In December 2011, the FASB issued guidance which contains new disclosure requirements regarding the nature of and entity's rights of offset and related arrangements associated with its financial instruments and derivative instruments. The new disclosures are designed to make financial statements prepared under U.S. GAAP more comparable to those prepared under International Financial Reporting Standards and will give the financial statement users information about both gross and net exposures. The guidance is effective for interim and annual reporting periods beginning on or after January 1, 2013.  The adoption of this guidance is not expected to have a material impact on the Company's financial position or results of operations.

In July 2012, the FASB issued revised guidance intended to simplify how an entity tests indefinite-lived intangible assets for impairment. The amendments will allow an entity first to assess qualitative factors to determine whether it is necessary to perform a quantitative impairment test. An entity will no longer be required to calculate the fair value of an indefinite-lived intangible asset and perform the quantitative test unless the entity determines, based on a qualitative assessment, that it is more likely than not that its fair value is less than its carrying amount. The amendments are effective for annual and interim indefinite-lived intangible asset impairment tests performed for fiscal years beginning after September 15, 2012. Early adoption is permitted. The adoption of this guidance is not expected to have a material impact on the Company's financial position or results of operations.

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Organization (Details) (USD $)	9 Months Ended				12 Months Ended	22 Months Ended						9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Aug. 17, 2012	Dec. 31, 2011	Dec. 31, 2011 Common Stock [Member]	Sep. 30, 2012 Common Stock [Member]	Jul. 02, 2012 Common Stock [Member]	Jun. 18, 2012 Common Stock [Member]	Nov. 07, 2011 Common Stock [Member]	Nov. 02, 2011 Common Stock [Member]	Sep. 06, 2011 Common Stock [Member]	Sep. 30, 2012 General Partner [Member] ARC Properties Operating Partnership, L.P. [Member]	Sep. 30, 2012 Affiliated Entity [Member] Contributor [Member] ARC Real Estate Partners, LLC [Member]	Sep. 30, 2012 Unaffiliated Third Party [Member]
Operations [Line Items]
Common stock, shares issued	11,163,617			7,323,434			487,500	3,250,000	100,000	1,500,000	5,600,000
Common stock, shares outstanding	11,163,617			7,323,434		11,200,000
Proceeds from Issuance of Common Stock					$ 78,100,000	$ 118,900,000
Proceeds from issuances of preferred shares	9,000,000	0
Maximum Amount of Offering from Universal Shelf Registration Statement			$ 500,000,000
Maximum amount of shares convertible into common stock			1,882,248
General partner ownership interest in OP, Percent												92.50%
Limited partner ownership interest in OP, Percent													2.60%	4.90%

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Mortgage Note Payable (Schedule Of Aggregate Future Principal Payments On Mortgage Notes Payable) (Details) (Mortgages [Member], USD $) In Thousands, unless otherwise specified	Sep. 30, 2012
Debt Instrument [Line Items]
July 1, 2012 - December 31, 2012	$ 0
2013	74
2014	189
2015	13,767
2016	11,760
Thereafter	9,970
Fair Value, Inputs, Level 3 [Member] | Carrying (Reported) Amount, Fair Value Disclosure [Member]
Debt Instrument [Line Items]
Outstanding Loan Amount	$ 35,760

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Share-Based Compensation (Details) (USD $) In Thousands, except Share data, unless otherwise specified	9 Months Ended				3 Months Ended	9 Months Ended		3 Months Ended	1 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012 Equity Plan [Member]	Dec. 31, 2011 Equity Plan [Member]	Sep. 30, 2012 Restricted Stock [Member] Equity Plan [Member]	Sep. 30, 2012 Restricted Stock [Member] Equity Plan [Member]	Dec. 31, 2011 Restricted Stock [Member] Equity Plan [Member]	Sep. 30, 2012 Restricted Stock [Member] Equity Plan [Member] Manager [Member]	Jun. 30, 2012 Restricted Stock [Member] Equity Plan [Member] Key Personnel of Affiliate [Member] Manager [Member]	Jun. 30, 2012 Restricted Stock [Member] Equity Plan [Member] ARC Properties Advisors, LLC [Member] Manager [Member]	Sep. 30, 2012 Restricted Stock [Member] Equity Plan [Member] ARC Properties Advisors, LLC [Member] Manager [Member]	Sep. 30, 2012 Restricted Stock [Member] Director Stock Plan [Member]	Dec. 31, 2011 Restricted Stock [Member] Director Stock Plan [Member]	Sep. 30, 2011 Restricted Stock [Member] Director Stock Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding, Number							167,400						9,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price			$ 12.50	$ 12.50								$ 11.47	$ 12.50
Shares issued in lieu of cash for services, in shares									93,683	93,683	167,400
Common stock held by related party, percent											3.00%
Restricted share vesting period											3 years	5 years
Share based compensation	$ 792	$ 2			$ 400	$ 700
Maximum authorized amount as a percentage of shares authorized								10.00%
Shares granted automatically upon election to board of directors, in shares												3,000
Periodic vesting percentage												20.00%
Number of shares authorized, in shares												99,000
Aggregate shares issued, in shares					201,527	201,527						16,200		9,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period						93,683						9,000
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price			$ 10.65									$ 10.65
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period						(59,556)						(1,800)
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Weighted Average Grant Date Fair Value			$ 12.41									$ 12.50

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CONSOLIDATED BALANCE SHEETS (USD $) In Thousands, unless otherwise specified	Sep. 30, 2012	Dec. 31, 2011
Real estate investments, at cost:
Land	$ 28,717	$ 18,489
Buildings, fixtures and improvements	182,700	107,340
Acquired intangible lease assets	24,306	11,044
Total real estate investments, at cost	235,723	136,873
Less: accumulated depreciation and amortization	(20,954)	(14,841)
Total real estate investments, net	214,769	122,032
Cash and cash equivalents	3,779	3,148
Prepaid expenses and other assets	3,015	1,798
Deferred costs, net	4,204	2,785
Assets held for sale, net	812	1,818
Total assets	226,579	131,581
LIABILITIES AND EQUITY
Mortgage notes payable	35,760	30,260
Senior secured revolving credit facility	91,090	42,407
Accounts payable and accrued expenses	1,276	858
Deferred rent	803	724
Total liabilities	128,929	74,249
Common stock, $0.01 par value, 240,000,000 shares authorized, 7,323,434 shares issued and outstanding at March 31, 2012 and December 31, 2011, respectively	112	73
Additional paid-in capital	101,325	57,582
Accumulated other comprehensive loss	(13)	0
Accumulated deficit	(13,295)	(4,025)
Total stockholders' equity	88,137	53,630
Non-controlling interest	9,513	3,702
Total equity	97,650	57,332
Total liabilities and equity	226,579	131,581
Series A Preferred Stock [Member]
LIABILITIES AND EQUITY
Series A Convertible Preferred Stock, $0.01 par value, 545,454 and 0 shares (liquidation preference $11.00 per share) authorized, issued and outstanding at June 30, 2012 and December 31, 2011, respectively	5	0
Series B Preferred Stock [Member]
LIABILITIES AND EQUITY
Series A Convertible Preferred Stock, $0.01 par value, 545,454 and 0 shares (liquidation preference $11.00 per share) authorized, issued and outstanding at June 30, 2012 and December 31, 2011, respectively	$ 3	$ 0

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Derivatives and Hedging Activities (Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2012	Sep. 30, 2011
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain (loss) recognized in accumulated other comprehensive income on interest rate derivatives (effective portion)	$ 0
Amount of gain (loss) reclassified from accumulated other comprehensive income into income as interest expense (effective portion)	0
Amount of gain (loss) recognized in income on derivative instruments (ineffective portion and amounts excluded from effectiveness testing)	0
Cash Flow Hedging [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain (loss) recognized in accumulated other comprehensive income on interest rate derivatives (effective portion)	0	(13)	0
Amount of gain (loss) recognized in income on derivative instruments (ineffective portion and amounts excluded from effectiveness testing)	0	0	0
Interest Expense [Member] | Cash Flow Hedging [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain (loss) reclassified from accumulated other comprehensive income into income as interest expense (effective portion)	$ 0	$ 0	$ 0

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CONSOLIDATED STATEMENT OF CASH FLOWS (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
Cash flows from operating activities:
Net loss	$ (3,639)	$ (685)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation	4,875	351
Amortization of intangible lease assets	1,217	21
Amortization of deferred costs	530	30
Amortization of above-market lease asset	56	0
Loss on held for sale properties	452	0
Share based compensation	792	2
Changes in assets and liabilities:
Prepaid expenses and other assets	(1,087)	(48)
Accounts payable and accrued expenses	142	(115)
Deferred rent	79	687
Net cash provided by (used in) operating activities	3,417	243
Cash flows from investing activities:
Investment in real estate	(92,498)	0
Proceeds from sale of property held for sale	553	0
Net cash provided by (used in) investing activities	(91,945)	0
Cash flows from financing activities:
Proceeds from mortgage notes payable	5,500	0
Proceeds from senior secured revolving credit facility	48,793	0
Payments on senior secured revolving credit facility	(110)	0
Proceeds from issuances of preferred shares	9,000	0
Proceeds from issuances of common stock	34,935	5,237
Payments of offering costs and fees related to stock issuances	(672)	(3,912)
Payments of deferred financing costs	(1,949)	(1,016)
Advance from affiliate bridge loan	796	0
Payment of affiliate bridge loan	(796)	0
Proceeds from affiliates	(164)	278
Premium payment on interest rate cap	(13)	0
Distributions to non-controlling interest holders	(376)	0
Distributions paid	(5,785)	0
Net cash provided by (used in) financing activities	89,159	587
Net change in cash and cash equivalents	631	830
Cash and cash equivalents, beginning of period	3,148	0
Cash and cash equivalents, end of period	3,779	830
Supplemental Disclosures:
Cash paid for interest	2,301	0
Cash paid for income taxes	64	0
OP units issued to acquire real estate investments	$ 6,352	$ 0

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Real Estate Investments (Schedule of Future Minimum Rental Payments for Operating Leases) (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2012
Real Estate [Abstract]
October 1, 2012 - December 31, 2012	$ 4,980
2013	20,228
2014	20,416
2015	20,246
2016	19,858
Thereafter	72,222
Total	$ 157,950

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Subsequent Events

9 Months Ended

Sep. 30, 2012

Subsequent Events [Abstract]

Subsequent Events

Subsequent Events

The Company has evaluated subsequent events through the filing of this Quarterly Report on Form 10-Q, and determined that there have been no events that have occurred that would require adjustments to our disclosures in the consolidated financial statements except for the transaction described below.

Completion of Acquisition of Assets

The following table presents certain information about the properties that the Company acquired from October 1, 2012 to October 26, 2012 (dollar amounts in thousands):

	No. of Buildings	Square Feet	Base Purchase Price (1)
Total Portfolio – September 30, 2012 (2)	124	2,198,877	$	235,723
Acquisitions	2	14,985	2,258
Total portfolio – October 26, 2012 (2)	126	2,213,862	$	237,981

____________________________

(1) Contract purchase price, excluding acquisition and transaction related costs.

(2) Total portfolio excludes one vacant property contributed in September 2011 which was classified as held for sale at September 30, 2012. The aggregate square footage and original base purchase price of this contributed vacant property was 3,200 and $1.2 million, respectively.

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Real Estate Investments (Schedule of Annualized Rental Income by Major Tenants) (Details)	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
Citizens Bank [Member]
Revenue, Major Customer [Line Items]
Annualized Rental Income	33.40%	75.00%
John Deere [Member]
Revenue, Major Customer [Line Items]
Annualized Rental Income	11.70%	0.00%
Home Depot [Member]
Revenue, Major Customer [Line Items]
Annualized Rental Income	11.20%	25.00%
GSA [Member]
Revenue, Major Customer [Line Items]
Annualized Rental Income	11.40%	0.00%

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Real Estate Investments (Tables)

9 Months Ended

Sep. 30, 2012

Real Estate [Abstract]

Assets and Liabilities Assumed

The following table presents the allocation of real estate investment assets acquired by the Company during the ninemonths ended September 30, 2012 (dollar amounts in thousands):

Real estate investments, at cost:
Land	$	10,228
Buildings, fixtures and improvements	75,360
Total tangible assets	85,588
Acquired intangibles:
In-place leases	13,262
Total assets acquired, net	98,850
OP Units issued to acquire real estate investments	(6,352		)
Cash paid to acquire real estate investments	$	92,498
Number of properties acquired	36

Schedule of Real Estate Properties

The Company’s portfolio of real estate investment properties (excluding one vacant property), which were all 100% leased, is comprised of the following 124 properties as of September 30, 2012:

Portfolio	Contribution or Acquisition Date	Number of Properties	Square Feet	Remaining Lease Term (1)	Base Purchase Price (2)		Capitalization Rate (3)	Annualized Rental Income/ NOI (4)		Annualized Rental Income/NOI per Square Foot
					(in thousands)			(in thousands)
Home Depot	Sep, 2011	1	465,600	17.2	$	23,398	9.7%	$	2,258	$	4.85
Citizens Bank	Sep, 2011	59	291,920	5.4	95,241		7.1%	6,726		23.04
Community Bank	Sep, 2011	1	4,410	3.8	705		5.1%	36		8.16
Dollar General I	Nov, 2011	20	177,668	6.9	9,981		9.7%	965		5.43
Advance Auto	Nov. & Dec. 2011	6	42,000	7.1	5,122		8.9%	457		10.88
Walgreens I	Dec, 2011	1	14,414	9.0	2,426		10.1%	245		17.00
Portfolio - December 31, 2011		88	996,012	8.2	136,873		7.8%	10,687		10.73
GSA I (5)	Jan, 2012	1	12,009	6.4	4,850		8.2%	396		32.98
Walgreens II	Jan, 2012	1	15,120	6.3	3,778		9.2%	346		22.88
FedEx	May, 2012	6	92,935	4.2	12,207		9.0%	1,099		11.83
John Deere	May, 2012	1	552,960	5.3	26,126		9.0%	2,353		4.26
GSA II (5)	Jun, 2012	1	18,640	6.0	5,835		11.1%	647		34.71
GSA III (5)	Jun, 2012	1	39,468	4.6	6,350		9.5%	604		15.30
Tractor Supply	Jun, 2012	1	38,507	6.1	1,921		9.5%	183		4.75
GSA IV (5)	Jun, 2012	1	22,509	6.0	3,890		11.0%	428		19.01
Dollar General II	Jun, 2012	16	134,102	5.1	5,993		10.7%	642		4.79
GSA V (5)	Jun, 2012	1	11,281	4.4	2,200		9.9%	217		19.24
Mrs Baird's	Jul, 2012	1	75,050	4.7	6,213		10.2%	631		8.40
Reckitt Benckiser	Aug, 2012	1	32,000	5.6	10,000		9.6%	964		30.13
CVS	Sep, 2012	3	31,620	4.7	4,855		9.9%	481		15.21
Iron Mountain	Sep, 2012	1	126,664	5.3	4,632		9.6%	443		3.50
2012 Acquisitions		36	1,202,865	5.2	98,850		9.5%	9,434		7.84
Portfolio - September 30, 2012(6)		124	2,198,877	6.8	$	235,723	8.5%	$	20,121	$	9.15

_______________________________________________

(1) Remaining lease term as of September 30, 2012, in years. If the portfolio has multiple locations with varying lease expirations, remaining lease term is calculated on a weighted-average basis. Total remaining lease term is a weighted average of the remaining lease term of the total portfolio.

(2) Original purchase price of the Contributed Properties and base purchase price of all other properties, in each case excluding acquisition and transaction-related costs. Acquisition and transaction-related costs include legal and various other closing costs incurred in connection with acquiring investment properties.

(3) Annualized rental income or annualized net operating income ("NOI"), on a straight-line basis, divided by base purchase price.

(4) Annualized rental income/NOI for net leases is rental income on a straight-line basis as of September 30, 2012, which includes the effect of tenant concessions such as free rent, as applicable. For modified gross leased properties, NOI is rental income on a straight-line basis as of September 30, 2012, which includes the effect of tenant concessions such as free rent, as applicable, plus operating expense reimbursement revenue less property operating expenses.

(5) Lease on property is a modified gross lease. As such, annualized rental income/NOI for this property is rental income on a straight-line basis as of September 30, 2012, which includes the effect of tenant concessions such as free rent plus operating expense reimbursement revenue less property operating expenses.

(6) Total portfolio excludes one vacant property contributed in September 2011, which is classified as held for sale as of September 30, 2012.

The following table presents certain information about the properties that the Company acquired from October 1, 2012 to October 26, 2012 (dollar amounts in thousands):

	No. of Buildings	Square Feet	Base Purchase Price (1)
Total Portfolio – September 30, 2012 (2)	124	2,198,877	$	235,723
Acquisitions	2	14,985	2,258
Total portfolio – October 26, 2012 (2)	126	2,213,862	$	237,981

____________________________

(1) Contract purchase price, excluding acquisition and transaction related costs.

(2) Total portfolio excludes one vacant property contributed in September 2011 which was classified as held for sale at September 30, 2012. The aggregate square footage and original base purchase price of this contributed vacant property was 3,200 and $1.2 million, respectively.

Schedule of Future Minimum Rental Payments for Operating Leases

The following table presents future minimum base rental cash payments due to the Company over the next five years and thereafter.  These amounts exclude contingent rent payments, as applicable, that may be collected from certain tenants based on provisions related to sales thresholds and increases in annual rent based on exceeding certain economic indexes among other items (amounts in thousands):

	Future Minimum Base Rent Payments
October 1, 2012 - December 31, 2012	$	4,980
2013	20,228
2014	20,416
2015	20,246
2016	19,858
Thereafter	72,222
	$	157,950

Schedule of Annualized Rental Income by Major Tenants

The following table lists the tenants whose annualized rental income/NOI on a straight-line basis represented greater than 10% of consolidated annualized rental income/NOI on a straight-line basis as of September 30, 2012 and 2011:

Tenant	September 30, 2012	September 30, 2011
Citizens Bank	33.4%	75.0%
John Deere	11.7%	—%
GSA	11.4%	—%
Home Depot	11.2%	25.0%

Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas

The following table lists the states where the Company has concentrations of properties where annual rental income/NOI on a straight-line basis represented greater than 10% of consolidated annualized rental income/NOI on a straight-line basis as of September 30, 2012 and 2011:

State	September 30, 2012		September 30, 2011
Michigan	14.2	%	22.7	%
South Carolina	12.4	%	25.0	%
Ohio	11.8	%	20.0	%
Iowa	11.7	%	*
New York	10.4	%	11.7	%

_______________________________________________

* The state's annualized rental income/NOI was not greater than 10% of total annualized rental income for all portfolio properties as of the period specified.

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Organization

9 Months Ended

Sep. 30, 2012

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization

Organization

American Realty Capital Properties, Inc. (the “Company”), is a Maryland corporation incorporated on December 2, 2010 that qualified as a real estate investment trust for U.S. federal income tax purposes for the year ended December 31, 2011. On September 6, 2011, the Company completed its initial public offering (the “IPO”) and sold a total of 5.6 million shares of common stock. The shares began trading on the NASDAQ Capital Market under the symbol “ARCP” on September 7, 2011. As of September 30, 2012, the Company had 11.2 million shares of common stock outstanding, including unvested restricted shares, and had received aggregate gross proceeds from common stock issuances of $118.9 million. In addition, as of September 30, 2012, the Company had received aggregate gross proceeds of $9.0 million from the issuance of convertible preferred stock.

On August 1, 2012, the Company filed a universal shelf registration statement and a resale registration statement with the U.S. Securities and Exchange Commission.  Each registration statement became effective on August 17, 2012.  The $500.0 million universal shelf registration statement, as amended, will enable the Company to grow its capital base over time while providing it flexibility to issue common stock, preferred stock, debt or equity-linked securities. As of September 30, 2012, no common stock, preferred stock, debt or equity-linked security has been issued under the universal shelf registration statement.  The resale registration statement, as amended, registers the resale of up to 1,882,248 shares of common stock issued in connection with any future conversion of certain currently outstanding restricted shares, convertible preferred stock or limited partnership interests. As of September 30, 2012, no common stock has been issued under the resale registration statement.

The Company was formed to acquire and own single-tenant, freestanding commercial real estate primarily subject to medium-term net leases with high credit quality tenants. The Company considers properties that are net leased on a “medium-term basis” to mean properties originally leased long-term (ten years or longer) that currently have a primary remaining lease duration of generally three to eight years, on average.

Substantially all of the Company's business is conducted through ARC Properties Operating Partnership, L.P. (the “OP”), a Delaware limited partnership. The Company is the sole general partner and holder of 92.5% of the equity interest in the OP as of September 30, 2012. ARC Real Estate Partners, LLC (the “Contributor”) and an unaffiliated investor are limited partners and owners of 2.6% and 4.9%, respectively, of the equity interest in the OP. After holding units of limited partner interests in the OP (“OP Units”) for a period of one year, holders of OP Units have the right to convert OP Units for the cash value of a corresponding number of shares of the Company's common stock or, at the option of the OP, a corresponding number of shares of the Company's common stock, as allowed by the limited partnership agreement of the OP. The remaining rights of the holders of OP Units are limited, however, and do not include the ability to replace the general partner or to approve the sale, purchase or refinancing of the OP’s assets.

The Company, which is externally managed with no employees, has retained ARC Properties Advisors, LLC (the "Manager"), a wholly owned subsidiary of AR Capital, LLC (the “Sponsor”), to manage its affairs on a day to day basis. These affiliated parties, including the Manager, the Sponsor and the Sponsor's wholly owned broker-dealer, Realty Capital Securities, LLC ("RCS" or the "Dealer Manager"), have received compensation and fees for services provided to the Company, and will continue to receive compensation and fees for providing on-going investment oversight, financing and management services to the Company, as applicable, in accordance with the terms of the respective agreements to which such affiliates are party.

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CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	Sep. 30, 2012	Dec. 31, 2011
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	240,000,000	240,000,000
Common stock, shares issued	11,163,617	7,323,434
Common stock, shares outstanding	11,163,617	7,323,434
Series A Preferred Stock [Member]
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	828,472	0
Preferred stock, shares issued	828,472	0
Preferred stock, shares outstanding	828,472	0
Liquidation Preference Per Share	$ 11.00	$ 11.00

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Related Party Transactions and Arrangements

9 Months Ended

Sep. 30, 2012

Related Party Transactions [Abstract]

Related Party Transactions and Arrangements

Related Party Transactions and Arrangements

Common Stock Ownership

Certain affiliates of the Company have purchased shares of the Company's common stock. As of September 30, 2012 and December 31, 2011, certain affiliates owned 19.4% and 31.3%, respectively, of the Company's common stock outstanding on a fully diluted basis, including the Contributor's 310,000 OP Units owned by the Company's Sponsor.

The Company has issued restricted stock to the Manager and non-executive directors in conjunction with a share-based compensation plan. See Note 13 — Share-Based Compensation.

Fees Paid in Connection with the Offering

RCS received selling commissions of 6% of the gross offering proceeds from the sale of the Company’s common stock in the IPO, which were entirely re-allowed to participating broker-dealers. In addition, RCS received dealer manager fees of 2% of the gross offering proceeds before reallowance to participating broker-dealers. RCS was permitted to re-allow all or a portion of its dealer manager fee to participating broker-dealers.

The following table details the results of such activities related to RCS (in thousands):

	Three Months Ended				Nine Months Ended
	September 30, 2012		September 30, 2011		September 30, 2012		September 30, 2011
Total commissions paid to affiliated Dealer Manager	$	—	$	919	$	—	$	919

The Company will reimburse the Manager for services relating to the IPO and the follow-on offerings. The following table details the results of such activities related to organizational and offering costs reimbursed to the Manager (amounts in thousands):

	Three Months Ended				Nine Months Ended
	September 30, 2012		September 30, 2011		September 30, 2012		September 30, 2011
Offering expense reimbursements	$	59	$	—	$	109	$	—

Fees Paid in Connection With the Operations of the Company

The Company will pay the Sponsor an acquisition fee equal to 1.0% of the contract purchase price (including assumed indebtedness) of each property the Company acquires which is originated by the Sponsor. The acquisition fee is payable in cash at the closing of each acquisition.

The Company will pay the Sponsor a financing fee equal to 0.75% of the amount available under any secured mortgage financing or refinancing that the Company obtains and uses for the acquisition of properties that is arranged by the Sponsor. The financing coordination fee is payable in cash at the closing of each financing.

The Company will pay the Manager an annual base management fee equal to 0.50% per annum of the average unadjusted book value of the Company's real estate assets, calculated and payable monthly in advance, provided that the full amount of the distributions declared by the Company for the six immediately preceding months is equal to or greater than certain net income thresholds related to our operations. Our Manager will waive such portion of its management fee in excess of such thresholds. The management fee is payable in cash. No such management fees have been incurred or paid to the Manager since inception.

The Company may be required to pay the Manager a quarterly incentive fee, calculated based on the Company's annualized earnings, weighted average number of shares and weighted average price per share of common stock. One half of each quarterly installment of the incentive fee will be payable in shares of common stock. The remainder of the incentive fee will be payable in cash. No such incentive fees have been incurred or paid to the Manager since inception.

The Company is required to reimburse the Sponsor for all out-of-pocket costs actually incurred by the Sponsor, including without limitation, legal fees and expenses, due diligence fees and expenses, other third party fees and expenses, costs of appraisals, travel expenses, nonrefundable option payments and deposits on properties not acquired, accounting fees and expenses, title insurance premiums and other closing costs, personnel costs and miscellaneous expenses relating to the selection, acquisition and due diligence of properties. The Company's reimbursement obligation is not subject to any dollar limitation. Expenses will be reimbursed in cash on a monthly basis following the end of each month. However, the Company will not reimburse the Sponsor for the salaries and other compensation of its personnel.

The following table details amounts incurred by the Company and contractually due to the Sponsor and the Manager and forgiven in connection with the operations related services described above (amounts in thousands):

	Three Months Ended				Three Months Ended
	September 30, 2012				September 30, 2011
	Incurred		Forgiven		Incurred		Forgiven
One-time fees:
Acquisition fees and related cost reimbursements	$	441	$	—	$	—	$	—
Financing fees and related cost reimbursements	369		—		—		—
Other expense reimbursements	45		—		—		—
On-going fees:
Base management fees	—		278		—		50
Incentive fees	—		—		—		—
Total operational fees and reimbursements	$	855	$	278	$	—	$	50

	Nine Months Ended				Nine Months Ended
	September 30, 2012				September 30, 2011
	Incurred		Forgiven		Incurred		Forgiven
One-time fees:
Acquisition fees and related cost reimbursements	$	1,703	$	—	$	—	$	—
Financing fees and related cost reimbursements	583		—		—		—
Other expense reimbursements	71		—		—		—
On-going fees:
Base management fees	—		664		—		50
Incentive fees	—		—		—		—
Total operational fees and reimbursements	$	2,357	$	664	$	—	$	50

Under an administrative support agreement between the Company and the Sponsor, the Sponsor will pay or reimburse the Company for its general administrative expenses, including, without limitation, legal fees, audit fees, board of directors fees, insurance, marketing and investor relation fees, until September 6, 2012, which was one year after the closing of the IPO, to the extent the amount of certain net earnings from operations thresholds, as specified in the agreement, is less than the amount of the distributions declared by the Company during this one-year period. To the extent these amounts are paid by the Sponsor, they would not be subject to reimbursement by the Company. These costs are presented net in the accompanying consolidated statements of operations and comprehensive loss.

The following table details general and administrative expenses absorbed by the Sponsor during the three and nine months ended September 30, 2012 (amounts in thousands).

	Three months ended		Nine months ended
	September 30, 2012		September 30, 2012
General and administrative expenses absorbed	$	—	$	164

The Company had a receivable from affiliates of $0.2 million at September 30, 2012, related to absorbed general and administrative expenses.

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Document and Entity Information	9 Months Ended
	Sep. 30, 2012	Oct. 29, 2012
Entity Information [Line Items]
Entity Registrant Name	AMERICAN REALTY CAPITAL PROPERTIES, INC.
Entity Central Index Key	0001507385
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Document Type	10-Q
Document Period End Date	Sep. 30, 2012
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q3
Amendment Flag	false
Entity Common Stock, Shares Outstanding		11,163,617
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes

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Economic Dependency

9 Months Ended

Sep. 30, 2012

Economic Dependency [Abstract]

Economic Dependency

Economic Dependency

Under various agreements, the Company has engaged or will engage the Manager and its affiliates to provide certain services that are essential to the Company, including asset management services, supervision of the management and leasing of properties owned by the Company, asset acquisition and disposition decisions, the sale of shares of the Company’s common stock available for issue in follow-on offerings, as well as other administrative responsibilities for the Company including accounting services and investor relations.

As a result of these relationships, the Company is dependent upon the Manager, the Sponsor and their affiliates. In the event that these companies were unable to provide the Company with the respective services, the Company would be required to find alternative providers of these services.

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CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (USD $)	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011
Revenues:
Rental income	$ 4,791,000	$ 576,000	$ 10,997,000	$ 576,000
Operating expense reimbursements	89,000	0	175,000	0
Total revenues	4,880,000	576,000	11,172,000	576,000
Operating expenses:
Acquisition and transaction related	819,000	604,000	3,297,000	604,000
Property operating	315,000	0	555,000	0
General and administrative	617,000	84,000	1,530,000	100,000
Depreciation and amortization	2,818,000	363,000	6,092,000	363,000
Total operating expenses	4,569,000	1,051,000	11,474,000	1,067,000
Operating loss	311,000	(475,000)	(302,000)	(491,000)
Other income (expense):
Interest expense	(1,136,000)	(185,000)	(2,873,000)	(185,000)
Loss from continuing operations	(825,000)	(660,000)	(3,175,000)	(676,000)
Net loss from continuing operations attributable to non-controlling interests	62,000	35,000	141,000	35,000
Net loss from continuing operations attributable to stockholders	(763,000)	(625,000)	(3,034,000)	(641,000)
Discontinued operations:
Loss from operations of held for sale properties	3,000	(9,000)	(12,000)	(9,000)
Loss on held for sale properties	(47,000)	0	(452,000)	0
Loss from discontinued operations	(44,000)	(9,000)	(464,000)	(9,000)
Loss from discontinued operations attributable to non-controlling interests	3,000	0	(24,000)	0
Loss from discontinued operations attributable to stockholders	(41,000)	(9,000)	(440,000)	(9,000)
Net loss	(869,000)	(669,000)	(3,639,000)	(685,000)
Net loss attributable to non-controlling interests	65,000	35,000	165,000	35,000
Net loss attributable to common stockholders, net of distributions	(804,000)	(634,000)	(3,474,000)	(650,000)
Comprehensive loss	0	0	(13,000)	0.00
Comprehensive loss	$ (804,000)	$ (634,000)	$ (3,487,000)	$ (650,000)
Basic and diluted net loss per share from continuing operations attributable to common stockholders	$ (0.08)		$ (0.38)	$ (1.25)
Basic and diluted net loss per share attributable to common stockholders	$ (0.09)	$ (0.42)	$ (0.43)	$ (1.27)
Segment, Continuing Operations [Member]
Discontinued operations:
Basic and diluted net loss per share attributable to common stockholders	$ (0.08)	$ (0.41)	$ (0.38)

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Fair Value of Financial Instruments

9 Months Ended

Sep. 30, 2012

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

Fair Value of Financial Instruments

The Company determines fair value based on quoted prices when available or through the use of alternative approaches, such as discounting the expected cash flows using market interest rates commensurate with the credit quality and duration of the investment. The guidance defines three levels of inputs that may be used to measure fair value:

Level 1 — Quoted prices in active markets for identical assets and liabilities that the reporting entity has the ability to access at the measurement date.

Level 2 — Inputs other than quoted prices included within Level 1 that are observable for the asset and liability or can be corroborated with observable market data for substantially the entire contractual term of the asset or liability.

Level 3 — Unobservable inputs that reflect the entity’s own assumptions about the assumptions that market participants would use in the pricing of the asset or liability and are consequently not based on market activity, but rather through particular valuation techniques.

The determination of where an asset or liability falls in the hierarchy requires significant judgment and considers factors specific to the asset or liability. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company evaluates its hierarchy disclosures each quarter and depending on various factors, it is possible that an asset or liability may be classified differently from quarter to quarter. However, the Company expects that changes in classifications between levels will be rare.

Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with those derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by the Company and its counterparties. However, as of September 30, 2012, the Company has assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and has determined that the credit valuation adjustments are not significant to the overall valuation of the Company’s derivatives. As a result, the Company has determined that its derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy.

The Company is required to disclose the fair value of financial instruments for which it is practicable to estimate that value. The fair value of short-term financial instruments such as cash and cash equivalents, due to affiliates and accounts payable approximate their carrying value on the accompanying consolidated balance sheets due to their short-term nature.

The fair values of the Company’s financial instruments that are not reported at fair value on the consolidated balance sheet are reported below (amounts in thousands):

		Carrying Amount at		Fair Value at		Carrying Amount at		Fair Value at
	Level	September 30, 2012		September 30, 2012		December 31, 2011		December 31, 2011
Mortgage notes payable	3	$	35,760	$	35,794	$	30,260	$	30,626
Senior secured revolving credit facility	3	$	91,090	$	91,090	$	42,407	$	42,407

The fair value of mortgage notes payable are obtained by calculating the present value at current market rates. The interest rate of the senior secured revolving credit facility is determined by a variable market rate and the Company's leverage ratio, and each have terms commensurate with market; as such the outstanding balance on the facility approximates fair value.

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Mortgage Note Payable

9 Months Ended

Sep. 30, 2012

Debt Disclosure [Abstract]

Mortgage Note Payable

Mortgage Notes Payable

The Company’s mortgage notes payable consist of the following as of September 30, 2012 and December 31, 2011 (dollar amounts in thousands):

	Encumbered Properties	Outstanding Loan Amount		Weighted Average Effective Interest Rate(1)		Weighted Average Maturity(2)
September 30, 2012	29	$	35,760	4.52	%	3.77
December 31, 2011	28	$	30,260	4.67	%	4.32

_______________________________________________

(1) Mortgage notes payable have fixed rates. Effective interest rates range from 3.68% to 5.32% at September 30, 2012 and 3.80% to 5.32% at December 31, 2011.

(2) Weighted average remaining years until maturity as of September 30, 2012 and December 31, 2011, respectively.

The following table summarizes the scheduled aggregate principal repayments subsequent to September 30, 2012 (amounts in thousands):

	Total
October 1, 2012 - December 31, 2012	$	—
2013	74
2014	189
2015	13,767
2016	11,760
Thereafter	9,970
Total	$	35,760

The Company’s sources of recourse financing generally require financial covenants, including restrictions on corporate guarantees, the maintenance of certain financial ratios (such as specified debt to equity and debt service coverage ratios) as well as the maintenance of a minimum net worth. As of September 30, 2012, the Company was in compliance with the debt covenants under the mortgage loan agreements.

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Summary of Significant Accounting Policies Summary of Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2012

Accounting Policies [Abstract]

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In May 2011, the Financial Accounting Standards Board (the "FASB") issued guidance that expands the existing disclosure requirements for fair value measurements, primarily for Level 3 measurements, which are measurements based on unobservable inputs such as the Company’s own data. This guidance is largely consistent with current fair value measurement principles with few exceptions that do not result in a change in general practice. The guidance was applied prospectively and was effective for interim and annual reporting periods ending after December 15, 2011. The adoption of this guidance did not have a material impact on the Company’s financial position or results of operations as the guidance relates only to disclosure requirements.

In June 2011, the FASB issued guidance requiring entities to present items of net income and other comprehensive income either in one continuous statement – referred to as the statement of comprehensive income – or in two separate, but consecutive, statements of net income and other comprehensive income. The new guidance does not change which components of comprehensive income are recognized in net income or other comprehensive income, or when an item of other comprehensive income must be reclassified to net income. In December 2011, the FASB deferred certain provisions of this guidance related to the presentation of certain reclassification adjustments out of accumulated other comprehensive income, by component in both the statement and the statement where the reclassification is presented. This guidance was applied prospectively and was effective for interim and annual reporting periods ended after December 15, 2011. The adoption of this guidance did not have a material impact on the Company’s financial position or results of operations but changed the location of the presentation of other comprehensive income to more closely associate the disclosure with net income.

In September 2011, the FASB issued guidance that allows entities to perform a qualitative analysis as the first step in determining whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If it is determined that it is not more likely than not that the fair value of the reporting unit is less than its carrying amount, then a quantitative analysis for impairment is not required. The guidance was effective for interim and annual impairment tests for fiscal periods beginning after December 15, 2011.  The adoption of this guidance did not have a material impact on the Company's financial position or results of operations.

In December 2011, the FASB issued guidance which contains new disclosure requirements regarding the nature of and entity's rights of offset and related arrangements associated with its financial instruments and derivative instruments. The new disclosures are designed to make financial statements prepared under U.S. GAAP more comparable to those prepared under International Financial Reporting Standards and will give the financial statement users information about both gross and net exposures. The guidance is effective for interim and annual reporting periods beginning on or after January 1, 2013.  The adoption of this guidance is not expected to have a material impact on the Company's financial position or results of operations.

In July 2012, the FASB issued revised guidance intended to simplify how an entity tests indefinite-lived intangible assets for impairment. The amendments will allow an entity first to assess qualitative factors to determine whether it is necessary to perform a quantitative impairment test. An entity will no longer be required to calculate the fair value of an indefinite-lived intangible asset and perform the quantitative test unless the entity determines, based on a qualitative assessment, that it is more likely than not that its fair value is less than its carrying amount. The amendments are effective for annual and interim indefinite-lived intangible asset impairment tests performed for fiscal years beginning after September 15, 2012. Early adoption is permitted. The adoption of this guidance is not expected to have a material impact on the Company's financial position or results of operations.

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Share-Based Compensation

9 Months Ended

Sep. 30, 2012

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Share-Based Compensation

Share-Based Compensation

Equity Plan

The Company has adopted the American Realty Capital Properties, Inc. Equity Plan (the "Equity Plan"), which provides for the grant of stock options, restricted shares of common stock, restricted stock units, dividend equivalent rights and other equity-based awards to the Manager, non-executive directors, officers and other employees and independent contractors, including employees or directors of the Manager and its affiliates who are providing services to the Company.

Under the Equity Plan, the Company's compensation committee is authorized to approve grants of equity-based awards to the Manager. Concurrently with the closing of the IPO, the Company granted to the Manager 167,400 restricted shares of common stock, which was equal to 3.0% of the number of shares of common stock sold through the IPO. This award of restricted shares vests ratably on a quarterly basis over a three-year period beginning on October 1, 2011. The Manager is entitled to receive “distribution equivalents” with respect to this restricted stock, whether or not vested, at the same time and in the same amounts as dividends are paid to the common stockholders, commencing on the first anniversary of the date of grant. The Manager will defer any distributions payable to it in connection with the restricted stock that it is granted under the Equity Plan until such time as the Company is covering the payment of distributions to the stockholders based on the criteria in the agreement, for the six immediately preceding months. In June 2012, the Company granted to the Manager an additional 93,683 restricted shares of common stock. In June 2012, the Manager distributed these 93,683 restricted shares of common stock to key personnel of an affiliate of the Manager. These restricted shares will vest annually over three years beginning in January 2013. In addition to these restricted stock grants, the Company may from time to time grant additional equity incentive awards to the Manager pursuant to the Equity Plan. The Manager may, in the future, allocate a portion of these awards or ownership or profits interests in it to officers or any other personnel of the Manager or other personnel of the Manager or its affiliates in order to provide incentive compensation to them. For the three and nine months ended September 30, 2012, compensation expense for restricted shares was $0.4 million and $0.7 million, respectively.

The Company authorized and reserved a total number of shares equal to 10.0% of the total number of issued and outstanding shares of common stock (on a fully diluted basis assuming the redemption of all OP Units for shares of common stock) to be issued at any time under the Equity Plan for equity incentive awards excluding the initial grant to the Manager. All such awards of shares will vest ratably on an annual basis over a three-year period beginning on the first anniversary of the date of grant and shall provide for “distribution equivalents” with respect to this restricted stock, whether or not vested, at the same time and in the same amounts as dividends are paid to the stockholders.

Director Stock Plan

Concurrently with the closing of the IPO, the Company granted 3,000 restricted shares of common stock to each of the Company's three independent directors, each of whom is a non-executive director, pursuant to the Director Stock Plan. Awards of restricted stock will vest ratably over a five-year period following the first anniversary of the date of grant in increments of 20.0% per annum, subject to the director’s continued service on the Board of Directors, and shall provide for “distribution equivalents” with respect to this restricted stock, whether or not vested, at the same time and in the same amounts as distributions are paid to the stockholders. At September 30, 2012, a total of 99,000 shares of common stock are reserved for issuance under the Director Stock Plan. As of September 30, 2012 and 2011, there were 16,200 and 9,000 unvested restricted shares (the "Directors' shares"), respectively, issued to independent directors under the Director Stock Plan. For the three and nine months ended September 30, 2012 and 2011, respectively, compensation expense for the vesting of Directors' shares was immaterial.

The following table details the restricted shares activity within the Equity Plan and Director Stock Plan during the nine months ended September 30, 2012:

	Equity Plan				Director Stock Plan
	Number of Common Shares		Weighted-Average Issue Price		Number of Common Shares		Weighted-Average Issue Price
Unvested, December 31, 2011	167,400		$	12.50	9,000		$	12.50
Granted	93,683		10.65		9,000		10.65
Vested	(59,556	)	12.41		(1,800	)	12.50
Unvested, September 30, 2012	201,527		$	12.50	16,200		$	11.47

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Common Stock

9 Months Ended

Sep. 30, 2012

Stockholders' Equity Note [Abstract]

Common Stock

Common Stock

On September 7, 2011, the Company closed its IPO and issued 5.6 million shares of common stock. On November 2, 2011, the Company sold 1.5 million common shares in a follow-on offering. On November 7, 2011, the underwriters exercised their option to purchase additional shares of common stock, which totaled 0.1 million shares. On June 18, 2012, the Company sold in a follow-on offering a total of 3.25 million shares of common stock. On July 2, 2012, the underwriters of the follow-on offering exercised their option to purchase an additional 0.5 million shares of common stock, which closed on July 9, 2012.

As of September 30, 2012 and December 31, 2011, the Company had a total of 11.2 million and 7.3 million shares of common stock outstanding, including unvested restricted shares, and had received aggregate proceeds from common stock issuances of $118.9 million and $78.1 million, respectively.

On September 7, 2011, the Company’s Board of Directors authorized and the Company declared an annual dividend rate of $0.875 per share payable monthly in cash beginning in October 2011, on the fifteenth day of each month to stockholders of record at the close of business on the eighth day of such month.

On February 27, 2012, the Company’s Board of Directors authorized and the Company declared an annual dividend rate of $0.880 per share. Accordingly, on March 15, 2012, the Company paid a dividend of $0.0733 per share to stockholders of record at the close of business on March 8, 2012.

On March 16, 2012, the Company’s Board of Directors authorized and the Company declared an increase to the Company’s annual dividend rate to $0.885, beginning May 9, 2012. Accordingly, on June 15, 2012, the Company paid a dividend of $0.07375 per share to stockholders of record at the close of business on the June 8, 2012.

On June 27, 2012, the Company's Board of Directors authorized and the Company declared an increase to the Company's annual dividend rate to $0.890, beginning August 9, 2012. Accordingly, on September 15, 2012, the Company paid a dividend of $0.07417 per share to stockholders of record at the close of business on September 8, 2012.

On September 30, 2012, the Company's Board of Directors authorized and the Company declared an increase to the Company's annual dividend rate to $0.895 per share, beginning November 9, 2012. On November 15, 2012, the Company will pay a monthly dividend of $0.07458 per share to stockholders of record at the close of business on November 8, 2012.

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Derivatives and Hedging Activities

9 Months Ended

Sep. 30, 2012

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging Activities Disclosure [Text Block]

Derivatives and Hedging Activities

Risk Management Objective of Using Derivatives

The Company may use derivative financial instruments, including interest rate swaps, caps, options, floors and other interest rate derivative contracts, to hedge all or a portion of the interest rate risk associated with its borrowings. The principal objective of such arrangements is to minimize the risks and/or costs associated with the Company's operating and financial structure as well as to hedge specific anticipated transactions. The Company does not intend to utilize derivatives for speculative or other purposes other than interest rate risk management. The use of derivative financial instruments carries certain risks, including the risk that the counterparties to these contractual arrangements are not able to perform under the agreements. To mitigate this risk, the Company only enters into derivative financial instruments with counterparties with high credit ratings and with major financial institutions with which the Company and its affiliates may also have other financial relationships. The Company does not anticipate that any of the counterparties will fail to meet their obligations.

Cash Flow Hedges of Interest Rate Risk

The Company's objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps and caps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. Interest rate caps designated as cash flow hedges involve the receipt of variable-rate amounts if interest rates rise above the cap strike rate on the contract.

The effective portion of changes in the fair value of derivatives designated and that qualify as cash flow hedges is recorded in accumulated other comprehensive income and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. During 2012, such derivatives were used to hedge the variable cash flows associated with forecasted variable-rate debt. The ineffective portion of the change in fair value of the derivatives is recognized directly in earnings. During the three and nine months ended September 30, 2012, the Company recorded no hedge ineffectiveness in earnings.

Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on the Company's variable-rate debt. During the next twelve months, the Company estimates that an additional $13,000 will be reclassified from other comprehensive income as an increase to interest expense.

As of September 30, 2012, the Company had the following outstanding interest rate derivative that was designated as cash flow hedge of interest rate risk (dollar amount in thousands).

Interest Rate Derivative	Number of Instruments	Notional Amount
Interest Rate Cap	1	$	50,000

The table below presents the fair value of the Company's derivative financial instruments as well as their classification on the balance sheet as of September 30, 2012. The Company had no derivatives as of December 31, 2011.

	Balance Sheet Location	September 30, 2012
Derivatives designated as hedging instruments:
Interest Rate Cap	Derivative, at fair value	$	—

The table below details the location in the financial statements of the gain or loss recognized on interest rate derivatives designated as cash flow hedges for the three and nine ended September 30, 2012 (amounts in thousands). The Company had no active derivatives for the three and nine months ended September 30, 2011.

	Three Months Ended				Nine Months Ended
	September 30, 2012		September 30, 2011		September 30, 2012			September 30, 2011
Amount of gain (loss) recognized in accumulated other comprehensive income on interest rate derivatives (effective portion)	$	—	$	—	$	(13	)	$	—
Amount of gain (loss) reclassified from accumulated other comprehensive income into income as interest expense (effective portion)	$	—	$	—	$	—		$	—
Amount of gain (loss) recognized in income on derivative instruments (ineffective portion and amounts excluded from effectiveness testing)	$	—	$	—	$	—		$	—

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Convertible Preferred Stock

9 Months Ended

Sep. 30, 2012

Convertible Preferred Stock [Abstract]

Preferred Stock [Text Block]

Convertible Preferred Stock

On May 11, 2012, the Company entered into a securities purchase agreement with an unaffiliated third party that is an “accredited investor” (as defined in Rule 501 of Regulation D as promulgated under the Securities Act of 1933, as amended) pursuant to which the Company sold 545,454 shares of the Company's Series A convertible preferred stock for gross proceeds of $6.0 million and aggregate net proceeds of $5.8 million after offering-related fees and expenses.

The Series A convertible preferred stock has a liquidation preference of $11.00 per share, plus accrued and unpaid dividends, and a redemption premium equal to one percent (1%). Commencing on May 31, 2012, the Company has been paying cumulative dividends on the Series A convertible preferred stock monthly in arrears at the annualized rate of $0.77 per share.

The Series A convertible preferred stock is convertible into the Company's common stock, at the option of the holder of the Series A convertible preferred stock, at a conversion price equal to $11.00 per share, beginning one year after the date of issuance. The Company, at its option at any time, may redeem the Series A convertible preferred stock, in whole or in part, at $11.00 per share.

On July 24, 2012, the Company entered into a securities purchase agreement with an unaffiliated third party that is an “accredited investor” (as defined in Rule 501 of Regulation D as promulgated under the Securities Act of 1933, as amended) pursuant to which the Company sold 283,018 shares of the Company's Series B convertible preferred stock for gross proceeds of approximately $3.0 million. After deducting offering-related fees and expenses, the aggregate net proceeds to the Company from the sale of the Series B convertible preferred stock were approximately $3.0 million.

The Series B convertible preferred stock has a liquidation preference of $10.60 per share, plus accrued and unpaid dividends, and a redemption premium equal to one percent (1%). Commencing on August 15, 2012, the Company has been paying cumulative dividends on the Series B convertible preferred stock monthly in arrears at an annualized rate of $0.74 per share.

The Series B convertible preferred stock is convertible into the Company's common stock, at the option of the holder of the Series B convertible preferred stock, at a conversion price equal to $10.60 per share, beginning one year after the date of issuance. The Company, at its option at any time, may redeem the Series B convertible preferred stock, in whole or in part, at $10.60 per share.

The Series A convertible preferred stock and the Series B convertible preferred stock each ranks senior to the Company's common stock and on parity with each other, and junior to any other preferred stock the Company may issue other than additional series of the Series A convertible preferred stock or Series B convertible preferred stock.

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Commitments and Contingencies

9 Months Ended

Sep. 30, 2012

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Litigation

In the ordinary course of business, the Company may become subject to litigation or claims. There are no material legal proceedings pending or known to be contemplated against the Company.

Environmental Matters

In connection with the ownership and operation of real estate, the Company may potentially be liable for costs and damages related to environmental matters. The Company does not own any properties subject to environmental-related issues, has not been notified by any governmental authority of any non-compliance, liability or other claim, and is not aware of any other environmental condition, in each case, that it believes will have a material adverse effect on the results of operations.

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Real Estate Investments (Schedule of Real Estate Properties) (Details) (USD $) In Thousands, unless otherwise specified				9 Months Ended
	Sep. 30, 2012	Jun. 30, 2012	Dec. 31, 2011	Sep. 30, 2012 Home Depot [Member] sqft property		Sep. 30, 2012 Citizens Bank [Member] sqft property		Sep. 30, 2012 Community Bank [Member] property sqft		Sep. 30, 2012 Dollar General I [Member] property sqft		Sep. 30, 2012 Advance Auto [Member] property sqft		Sep. 30, 2012 Walgreens I [Member] property sqft		Sep. 30, 2012 Portfolio as of Dec. 31, 2011 [Member] sqft property		Sep. 30, 2012 GSA I [Member] property sqft		Sep. 30, 2012 Walgreens II [Member] sqft property		Sep. 30, 2012 FedEx [Member] sqft property		Sep. 30, 2012 John Deere [Member] property sqft		Sep. 30, 2012 GSA, Two [Member] sqft property		Sep. 30, 2012 GSA III [Member] property sqft		Sep. 30, 2012 Tractor Supply [Member] sqft property		Sep. 30, 2012 GSA IV [Member] property sqft		Sep. 30, 2012 Dollar General, Two [Member] sqft property		Sep. 30, 2012 GSA, Five [Member] sqft property		Sep. 30, 2012 Mrs. Baird's [Member] sqft property		Sep. 30, 2012 Reckitt Benckiser [Member] property sqft		Sep. 30, 2012 CVS i [Member] sqft property		Sep. 30, 2012 Iron Mountian [Member] property sqft		Sep. 30, 2012 2012 Acquisitons [Member] property sqft		Sep. 30, 2012 Portfolio as of June 30, 2012 [Member] property sqft		Sep. 30, 2012 Occupied [Member] property
Real Estate Properties [Line Items]
Occupancy Rate		100.00%
Number of Real Estate Properties				1		59		1		20		6		1		88		1	[1]	1		6		1		1	[1]	1	[1]	1		1	[1]	16		1	[1]	1	[1]	1	[1]	3	[1]	1	[1]	36	[1]	124	[2]	125
Square Feet				465,600		291,920		4,410		177,668		42,000		14,414		996,012		12,009	[1]	15,120		92,935		552,960		18,640	[1]	39,468	[1]	38,507		22,509	[1]	134,102		11,281	[1]	75,050	[1]	32,000	[1]	31,620	[1]	126,664	[1]	1,202,865	[1]	2,198,877	[2]
Remaining Lease Term				17 years 2 months 12 days	[3]	5 years 4 months 24 days	[3]	3 years 9 months 18 days	[3]	6 years 10 months 24 days	[3]	7 years 1 month 6 days	[3]	9 years	[3]	8 years 2 months 12 days	[3]	6 years 4 months 24 days	[1],[3]	6 years 3 months 18 days	[3]	4 years 2 months 12 days	[3]	5 years 3 months 18 days	[3]	6 years	[3]	4 years 7 months 6 days	[3]	6 years 1 month 6 days	[3]	6 years	[3]	5 years 1 month 6 days	[3]	4 years 4 months 24 days	[3]	4 years 8 months 12 days	[3]	5 years 7 months 6 days	[3]	4 years 8 months 12 days	[3]	5 years 3 months 18 days	[3]	5 years 2 months		6 years 9 months 18 days
Base Purchase Price	$ 235,723		$ 136,873	$ 23,398	[4]	$ 95,241	[4]	$ 705	[4]	$ 9,981	[4]	$ 5,122	[4]	$ 2,426	[4]	$ 136,873	[4]	$ 4,850	[1],[4]	$ 3,778	[4]	$ 12,207	[4]	$ 26,126	[4]	$ 5,835	[1],[4]	$ 6,350	[1],[4]	$ 1,921	[4]	$ 3,890	[1],[4]	$ 5,993	[4]	$ 2,200	[1],[4]	$ 6,213	[1],[4]	$ 10,000	[1],[4]	$ 4,855	[1],[4]	$ 4,632	[1],[4]	$ 98,850	[1],[4]	$ 235,723	[2],[4]
Capitalization Rate				9.70%	[5]	7.10%	[5]	5.10%	[5]	9.70%	[5]	8.90%	[5]	10.10%	[5]	7.80%	[5]	8.20%	[1],[5]	9.20%	[5]	9.00%	[5]	9.00%	[5]	11.10%	[1],[5]	9.50%	[1],[5]	9.50%	[5]	11.00%	[1],[5]	10.70%	[5]	9.90%	[1],[5]	10.20%	[1],[5]	9.60%	[1],[5]	9.90%	[1],[5]	9.60%	[1],[5]	9.50%	[1],[5]	8.50%	[2],[5]
Annualized Net Operating Income				$ 2,258	[6]	$ 6,726	[6]	$ 36	[6]	$ 965	[6]	$ 457	[6]	$ 245	[6]	$ 10,687	[6]	$ 396	[1],[6]	$ 346	[6]	$ 1,099	[6]	$ 2,353	[6]	$ 647	[1],[6]	$ 604	[1],[6]	$ 183	[6]	$ 428	[1],[6]	$ 642	[6]	$ 217	[1],[6]	$ 631	[1],[6]	$ 964	[1],[6]	$ 481	[1],[6]	$ 443	[1],[6]	$ 9,434	[1],[6]	$ 20,121	[2],[6]
Annualized Rental Income/NOI per Square Foot				4.85		23.04		8.16		5.43		10.88		17.00		10.73		32.98	[1]	22.88		11.83		4.26		34.71	[1]	15.30	[1]	4.75		19.01	[1]	4.79		19.24	[1]	8.40	[1]	30.13	[1]	15.21	[1]	3.50	[1]	7.84		9.15	[2]

[1] Lease on property is a modified gross lease. As such, annualized rental income/NOI for this property is rental income on a straight-line basis as of September 30, 2012, which includes the effect of tenant concessions such as free rent plus operating expense reimbursement revenue less property operating expenses.

[2] Total portfolio excludes one vacant property contributed in September 2011, which is classified as held for sale as of September 30, 2012.

[3] Remaining lease term as of September 30, 2012, in years. If the portfolio has multiple locations with varying lease expirations, remaining lease term is calculated on a weighted-average basis. Total remaining lease term is a weighted average of the remaining lease term of the total portfolio.

[4] Original purchase price of the Contributed Properties and base purchase price of all other properties, in each case excluding acquisition and transaction-related costs. Acquisition and transaction-related costs include legal and various other closing costs incurred in connection with acquiring investment properties.

[5] Annualized rental income or annualized net operating income ("NOI"), on a straight-line basis, divided by base purchase price.

[6] Annualized rental income/NOI for net leases is rental income on a straight-line basis as of September 30, 2012, which includes the effect of tenant concessions such as free rent, as applicable. For modified gross leased properties, NOI is rental income on a straight-line basis as of September 30, 2012, which includes the effect of tenant concessions such as free rent, as applicable, plus operating expense reimbursement revenue less property operating expenses.

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Related Party Transactions and Arrangements (Schedule of Amount Contractually Due and Forgiven in Connection With Operation Related Services) (Details) (USD $)	3 Months Ended		9 Months Ended	12 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Dec. 31, 2011
Paid [Member] | Total operation fees and reimbursements [Member]
Related Party Transaction [Line Items]
Related party operation fees and reimbursements	$ 855,000	$ 0	$ 2,357,000	$ 0
Paid [Member] | One-time Fees [Member] | Acquisition fees and related expenses [Member]
Related Party Transaction [Line Items]
Related party operation fees and reimbursements	441,000	0	1,703,000	0
Paid [Member] | One-time Fees [Member] | Financing fees and related cost reimbursements [Member]
Related Party Transaction [Line Items]
Related party operation fees and reimbursements	369,000	0	583,000	0
Paid [Member] | One-time Fees [Member] | Other expense reimbursements [Member]
Related Party Transaction [Line Items]
Related party operation fees and reimbursements	45,000	0	71,000	0
Paid [Member] | On-going Fees [Member] | Base management fees [Member]
Related Party Transaction [Line Items]
Related party operation fees and reimbursements	0	0	0	0
Paid [Member] | On-going Fees [Member] | Incentive fees [Member]
Related Party Transaction [Line Items]
Related party operation fees and reimbursements	0	0	0	0
Forgiven [Member] | Total operation fees and reimbursements [Member]
Related Party Transaction [Line Items]
Related party operation fees and reimbursements	278,000	50,000	664,000	50,000
Forgiven [Member] | One-time Fees [Member] | Acquisition fees and related expenses [Member]
Related Party Transaction [Line Items]
Related party operation fees and reimbursements	0	0	0	0
Forgiven [Member] | One-time Fees [Member] | Financing fees and related cost reimbursements [Member]
Related Party Transaction [Line Items]
Related party operation fees and reimbursements	0	0	0	0
Forgiven [Member] | One-time Fees [Member] | Other expense reimbursements [Member]
Related Party Transaction [Line Items]
Related party operation fees and reimbursements	0	0	0	0
Forgiven [Member] | On-going Fees [Member] | Base management fees [Member]
Related Party Transaction [Line Items]
Related party operation fees and reimbursements	278,000	50,000	664,000	50,000
Forgiven [Member] | On-going Fees [Member] | Incentive fees [Member]
Related Party Transaction [Line Items]
Related party operation fees and reimbursements	$ 0	$ 0	$ 0	$ 0

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Discontinued Operations and Properties Held for Sale

9 Months Ended

Sep. 30, 2012

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations and Properties Held for Sale

Discontinued Operations and Properties Held for Sale

The Company separately classifies properties held for sale in the accompanying consolidated balance sheets and operating results for those properties as discontinued operations in the accompanying consolidated statements of operations. In the normal course of business, changes in the market may compel the Company to decide to classify a property as held for sale or reclassify a property that is designated as held for sale back to held for investment. In these situations, the property is transferred to held for sale or back to held for investment at the lesser of fair value or depreciated cost. As of September 30, 2012 and December 31, 2011, the Company held one and two vacant properties, respectively, which were classified as held for sale on the accompanying respective balance sheets.

The Company sold one held for sale property during the three months ended September 30, 2012. See Note 3 — Real Estate Investments.

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Fair Value of Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2012

Fair Value Disclosures [Abstract]

Fair Value, by Balance Sheet Grouping

The fair values of the Company’s financial instruments that are not reported at fair value on the consolidated balance sheet are reported below (amounts in thousands):

		Carrying Amount at		Fair Value at		Carrying Amount at		Fair Value at
	Level	September 30, 2012		September 30, 2012		December 31, 2011		December 31, 2011
Mortgage notes payable	3	$	35,760	$	35,794	$	30,260	$	30,626
Senior secured revolving credit facility	3	$	91,090	$	91,090	$	42,407	$	42,407

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Related Party Transactions and Arrangements (Schedule of Selling Commissions and Dealer Manager Fees) (Details) (Dealer Manager [Member], Realty Capital Securities, LLC [Member], Sales Commissions and Fees [Member], USD $)	3 Months Ended	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2012	Sep. 30, 2011
Dealer Manager [Member] | Realty Capital Securities, LLC [Member] | Sales Commissions and Fees [Member]
Schedule of Selleing Commission and Dealer Manager Fees [Line Items]
Related Party Transaction, Expenses from Transactions with Related Party	$ 0	$ 0	$ 919,000

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Fair Value of Financial Instruments (Fair Value, by Balance Sheet Grouping) (Details) (Fair Value, Inputs, Level 3 [Member], USD $) In Thousands, unless otherwise specified	Sep. 30, 2012	Dec. 31, 2011
Mortgages Notes Payable [Member] | Carrying (Reported) Amount, Fair Value Disclosure [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Debt, fair value	$ 35,760	$ 30,260
Mortgages Notes Payable [Member] | Estimate of Fair Value, Fair Value Disclosure [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Debt, fair value	35,794	30,626
Senior Secured Revolving Credit Facility [Member] | Carrying (Reported) Amount, Fair Value Disclosure [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Debt, fair value	91,090	42,407
Senior Secured Revolving Credit Facility [Member] | Estimate of Fair Value, Fair Value Disclosure [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Debt, fair value	$ 91,090	$ 42,407

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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (USD $) In Thousands, except Share data, unless otherwise specified	Total USD ($)	Common Stock USD ($)	Additional Paid-In Capital USD ($)	Accumulated Deficit USD ($)	Total Stockholders' Equity USD ($)	Non-Controlling Interests USD ($)	Accumulated Other Comprehensive Income (Loss) [Member] USD ($)	Convertible Preferred Stock [Member] USD ($)	Common Stock [Member] USD ($)	Common Stock [Member] Common Stock USD ($)	Common Stock [Member] Additional Paid-In Capital USD ($)	Common Stock [Member] Total Stockholders' Equity USD ($)	Convertible Preferred Stock [Member] USD ($)	Convertible Preferred Stock [Member] Additional Paid-In Capital USD ($)	Convertible Preferred Stock [Member] Total Stockholders' Equity USD ($)	Convertible Preferred Stock [Member]
Balance at Dec. 31, 2011	$ 57,332	$ 73	$ 57,582	$ (4,025)	$ 53,630	$ 3,702
Balance, (in shares) at Dec. 31, 2011		7,323,434
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Shares Issued (in shares)										3,737,500						828,472
Stock Issued During Period, Value, New Issues								8	34,935	38	34,897	34,935	9,000	8,992	9,000
Offering costs, commissions and dealer manager fees	(937)		(937)		(937)
Share based compensation (in shares)		102,683
Share based compensation	792	1	791		792
Distributions Declared	(5,796)			(5,796)	(5,796)
Contribution from non-controlling interest holder	6,352					6,352
Distributions to non-controlling interest holders	(376)					(376)
Accumulated other comprehensive income (loss) - derivatives	(13)				(13)		(13)
Net loss	(3,639)			(3,474)	(3,474)	(165)
Balance at Sep. 30, 2012	$ 97,650	$ 112	$ 101,325	$ (13,295)	$ 88,137	$ 9,513	$ (13)	$ 8
Balance, (in shares) at Sep. 30, 2012		11,163,617						828,472

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Senior Secured Revolving Credit Facility

9 Months Ended

Sep. 30, 2012

Line of Credit Facility [Abstract]

Senor Secured Revolving Credit Facility [Text Block]

Senior Secured Revolving Credit Facility

On September 7, 2011, the Company closed on a senior secured revolving credit facility with RBS Citizens, N.A. Through an "accordion feature," subject to certain conditions, the Company may increase its total commitments under the credit facility to $150.0 million. The proceeds of advances made under the credit agreement may be used to finance the acquisition of net leased, investment or non-investment grade leased properties and for other permitted corporate purposes. Up to $10.0 million of the facility is available for letter of credits. The credit agreement has a term of 36 months and matures on September 7, 2014, subject to the Company's right to a 24-month extension.

Any advance made under the credit facility will bear floating interest at per annum rates equal to the one-month London Interbank Offered Rate (“LIBOR”) plus 2.15% to 2.90% depending on the Company's loan to value ratio as specified in the credit agreement. In the event of a default, the lender has the right to terminate its obligations under the credit agreement, including the funding of future advances, and to accelerate the payment on any unpaid principal amounts outstanding. The credit facility requires a fee of 0.15% on the unused balance if amounts outstanding under the facility are 50% or more of the total facility amount and 0.25% on the unused balance if amounts outstanding under the facility are less than 50% of the total facility amount.

As of September 30, 2012, there was $91.1 million outstanding on this facility, which bore an interest rate of 2.7%, collateralized by 95 properties. Additional borrowings may become available under this facility based upon the availability of additional collateral, among other factors. In September 2012, the Company expanded the facility to allow for additional future acquisitions. As a result, there was $18.9 million available for future acquisitions at September 30, 2012. As of December 31, 2011, there was $42.4 million outstanding on this facility with an interest rate of 3.17%, collateralized by 59 properties.

The Company’s sources of recourse financing generally require financial covenants, including restrictions on corporate guarantees, the maintenance of certain financial ratios (such as specified debt to equity and debt service coverage ratios) as well as the maintenance of a minimum net worth. As of September 30, 2012, the Company was in compliance with the debt covenants under the senior secured revolving credit facility agreement.

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Derivatives and Hedging Activities (Tables)

9 Months Ended

Sep. 30, 2012

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Interest Rate Derivatives [Table Text Block]

As of September 30, 2012, the Company had the following outstanding interest rate derivative that was designated as cash flow hedge of interest rate risk (dollar amount in thousands).

Interest Rate Derivative	Number of Instruments	Notional Amount
Interest Rate Cap	1	$	50,000

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Table Text Block]

The table below presents the fair value of the Company's derivative financial instruments as well as their classification on the balance sheet as of September 30, 2012. The Company had no derivatives as of December 31, 2011.

	Balance Sheet Location	September 30, 2012
Derivatives designated as hedging instruments:
Interest Rate Cap	Derivative, at fair value	$	—

Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance [Table Text Block]

The table below details the location in the financial statements of the gain or loss recognized on interest rate derivatives designated as cash flow hedges for the three and nine ended September 30, 2012 (amounts in thousands). The Company had no active derivatives for the three and nine months ended September 30, 2011.

	Three Months Ended				Nine Months Ended
	September 30, 2012		September 30, 2011		September 30, 2012			September 30, 2011
Amount of gain (loss) recognized in accumulated other comprehensive income on interest rate derivatives (effective portion)	$	—	$	—	$	(13	)	$	—
Amount of gain (loss) reclassified from accumulated other comprehensive income into income as interest expense (effective portion)	$	—	$	—	$	—		$	—
Amount of gain (loss) recognized in income on derivative instruments (ineffective portion and amounts excluded from effectiveness testing)	$	—	$	—	$	—		$	—

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Senior Secured Revolving Credit Facility (Details) (USD $)	0 Months Ended	4 Months Ended	9 Months Ended
	Sep. 07, 2011	Dec. 31, 2011 property	Sep. 30, 2012 property
Line of Credit Facility [Line Items]
Long-term Line of Credit		$ 42,407,000	$ 91,090,000
Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Maximum capacity on credit facility	150,000,000
Term of credit facility	36 months
Debt, fair value		42,400,000	91,100,000
Interest rate during period		3.17%	2.70%
Properties collateralized, in properties		59	95
Line of Credit Facility, Remaining Borrowing Capacity			18,900,000
Revolving Credit Facility [Member] | LIBOR Plus [Member] | Minimum [Member]
Line of Credit Facility [Line Items]
Spread on variable rate basis	2.15%
Revolving Credit Facility [Member] | LIBOR Plus [Member] | Maximum [Member]
Line of Credit Facility [Line Items]
Spread on variable rate basis	2.90%
Revolving Credit Facility [Member] | Option 1 [Member]
Line of Credit Facility [Line Items]
Unused capacity commitment fee percentage threshold	50.00%
Revolving Credit Facility [Member] | Option 2 [Member]
Line of Credit Facility [Line Items]
Unused minimum commitment fee percentage threshold	50.00%
Letter of Credit [Member] | Maximum [Member]
Line of Credit Facility [Line Items]
Maximum capacity on credit facility	$ 10,000,000
RBS Citizens, N.A. [Member] | Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Line of credit, length of extension option	24 months
Above Threshold [Member] | Revolving Credit Facility [Member] | Option 1 [Member]
Line of Credit Facility [Line Items]
Unused capacity fee percentage	0.15%
Below Threshold [Member] | Revolving Credit Facility [Member] | Option 2 [Member]
Line of Credit Facility [Line Items]
Unused capacity fee percentage	0.25%

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Net Loss Per Share

9 Months Ended

Sep. 30, 2012

Earnings Per Share [Abstract]

Net Loss Per Share

Net Loss Per Share 

The following is a summary of the basic and diluted net loss per share computation for the three and nine months ended September 30, 2012 and 2011 (dollars in thousands, expect for shares and per share data):  

	Three Months Ended September 30,						Nine Months Ended September 30,
	2012			2011			2012			2011
Net loss from continuing operations attributable to stockholders	$	(763	)	$	(625	)	$	(3,034	)	$	(641	)
Less: dividends declared on preferred shares	(140		)	—			(210		)
Net loss from continuing operations attributable to common stockholders	(903		)	(625		)	(3,244		)	(641		)
Net loss from discontinued operations attributable to stockholders	(41		)	(9		)	(440		)	(9		)
Net loss attributable to common stockholders, net of dividends on preferred shares	$	(944	)	$	(634	)	$	(3,684	)	$	(650	)
Weighted average common shares outstanding	10,846,432			1,515,710			8,543,365			511,452
Basic and diluted net loss per share from continuing operations attributable to common stockholders	$	(0.08	)	$	(0.41	)	$	(0.38	)	$	(1.25	)
Basic and diluted net loss per share from discontinued operations attributable to stockholders	$	—		$	(0.01	)	$	(0.05	)	$	(0.02	)
Basic and diluted net loss per share attributable to common stockholders	$	(0.09	)	$	(0.42	)	$	(0.43	)	$	(1.27	)

As of September 30, 2012, the Company had 886,376 OP Units issued, which are convertible to an equal number of shares of the Company's common stock, 217,727 shares of unvested restricted stock outstanding, 545,454 shares of the Company's Series A preferred convertible stock outstanding and 283,018 shares of the Company's Series B preferred convertible stock outstanding, which were excluded from the calculation of diluted loss per share as the effect would have been antidilutive.